Filing Flows › Designer Brands (DBI) › Takeover & LBO
Is Designer Brands (DBI) a takeover target?
A leveraged buyout at today's price plus 30% ($8.76 a share) would return about 12% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $6.46 a share (−4% against today's $6.74). Historically 5.4% of companies with its figures were bought within a year (1.08× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $8.76 | today's $6.74 plus 30% |
| × shares | 56.0 million | |
| = Equity value | $490M | |
| + Debt refinanced | $416M | |
| − Cash | $51.6M | |
| = Enterprise value | $855M | 5.4× EBITDA of $160M |
| Fees | $17.1M | 2% of the price |
| New debt | $556M | 3.5× EBITDA at 7.65% a year; the limit that binds: 65% of the price |
| Buyer's own money | $316M | 36% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $2.9B | $158M | $42.5M | $61.5M | $494M |
| Year 2 | $2.9B | $159M | $37.8M | $64.5M | $430M |
| Year 3 | $2.9B | $160M | $32.9M | $66.2M | $364M |
| Year 4 | $3.0B | $164M | $27.8M | $68.8M | $295M |
| Year 5 | $3.1B | $168M | $22.6M | $72.4M | $222M |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 4.6× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $783M | |
| − Debt left | $222M | |
| = Buyer's equity | $560M | |
| Money multiple | 1.77× | on $316M put in |
| Buyer's yearly return (IRR) | 12.1% |
Price against return
What the buyer makes at other premiums over today's $6.74; the IRR reaches 20% at $6.46 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $7.41 | 16.7% |
| 20% | $8.09 | 14.4% |
| 30% | $8.76 | 12.1% |
| 40% | $9.44 | 9.8% |
| 50% | $10.11 | 7.6% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $2.9B | |
| EBITDA, last 12 months | $160M | 5.5% of revenue |
| Depreciation and amortization | $57.7M | |
| Capital spending | $37.1M | |
| Debt | $416M | |
| Cash | $51.6M | |
| Share price | $6.74 | on Oct 30, 2026 |
Fixed rules, the same as the interactive view's starting point: the shares are bought at today's price plus 30%, the company's debt is refinanced and fees take 2%. New debt is the least of 5.5× EBITDA, 65% of the price and the amount whose interest EBITDA covers 2 times, at 7.65% a year (SOFR 3.89% plus the high-yield B spread 3.26% plus 0.5%, rates of Oct 15, 2026). Revenue grows -0.8% in the first year — the company's own rate, held between −3% and +8% — fading to 3% by year 5; the EBITDA margin, depreciation and capital spending stay at today's share of revenue; working capital takes 10% of each year's added revenue; tax is 30% of profit after interest. Every dollar of free cash flow repays debt. After 5 years the buyer sells at today's multiple of EBITDA.
What a takeover could cost
Takeovers on record paid a median premium of 32.5% over the share price before the deal (the middle half 20% to 51.8%), according to the 1,437 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Designer Brands would cost about $8.93 a share, $500M for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 20% | $8.09 | $453M |
| Median | 32.5% | $8.93 | $500M |
| High end (a quarter paid more) | 51.8% | $10.23 | $573M |
The odds, from history
Historically 5.4% of companies with its figures were bought within a year (1.08× the average). Its figures put it in decile 7 of 10 (10 = the most likely to be bought). The odds come from a model of every merger proxy, tender-offer response and going-private statement filed on EDGAR since 2011, set against each company's size, margins, debt, cash flow and growth the year before.
Designer Brands' latest quarter
Designer Brands, Q2 FY27: revenue $731M (-1% year over year), operating margin 7.5%, net earnings $17.6M, operating cash flow $70.3M. The chart follows the revenue to costs, profit and cash.
Questions
Is Designer Brands being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Designer Brands?
A leveraged buyout at today's price plus 30% ($8.76 a share) would return about 12% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $6.46 a share (−4% against today's $6.74).
What would a takeover of Designer Brands cost?
Takeovers on record paid a median premium of 32.5% over the share price before the deal (the middle half 20% to 51.8%), according to the 1,437 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Designer Brands would cost about $8.93 a share, $500M for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.