Filing Flows › DigitalOcean Holdings (DOCN) › Takeover & LBO
Is DigitalOcean Holdings (DOCN) a takeover target?
A leveraged buyout at today's price plus 30% ($175.27 a share) would return about 0% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $79.23 a share (−41% against today's $134.82). Historically 3.3% of companies with its figures were bought within a year (0.65× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $175.27 | today's $134.82 plus 30% |
| × shares | 114.7 million | |
| = Equity value | $20.1B | |
| + Debt refinanced | $921M | |
| − Cash | $767M | |
| = Enterprise value | $20.3B | 65.4× EBITDA of $310M |
| Fees | $405M | 2% of the price |
| New debt | $1.7B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $19.0B | 92% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $1.2B | $335M | $130M | $68.5M | $1.6B |
| Year 2 | $1.3B | $357M | $125M | $86.9M | $1.5B |
| Year 3 | $1.3B | $377M | $118M | $105M | $1.4B |
| Year 4 | $1.4B | $393M | $110M | $123M | $1.3B |
| Year 5 | $1.4B | $405M | $101M | $139M | $1.2B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 50.4× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $20.4B | |
| − Debt left | $1.2B | |
| = Buyer's equity | $19.2B | |
| Money multiple | 1.01× | on $19.0B put in |
| Buyer's yearly return (IRR) | 0.3% |
Price against return
What the buyer makes at other premiums over today's $134.82; the IRR reaches 20% at $79.23 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $148.30 | 4.0% |
| 20% | $161.78 | 2.0% |
| 30% | $175.27 | 0.3% |
| 40% | $188.75 | −1.3% |
| 50% | $202.23 | −2.8% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $1.1B | |
| EBITDA, last 12 months | $310M | 28.1% of revenue |
| Depreciation and amortization | $172M | |
| Capital spending | $116M | |
| Debt | $921M | |
| Cash | $767M | |
| Share price | $134.82 | on Oct 9, 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 8.0% 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 12% 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 in its sector paid a median premium of 30% over the share price before the deal (the middle half 12% to 31%), according to the 14 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, DigitalOcean Holdings would cost about $175.27 a share, $20.1B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 12% | $151.00 | $17.3B |
| Median | 30% | $175.27 | $20.1B |
| High end (a quarter paid more) | 31% | $176.61 | $20.3B |
The odds, from history
Historically 3.3% of companies with its figures were bought within a year (0.65× the average). Its figures put it in decile 3 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.
DigitalOcean Holdings' latest quarter
DigitalOcean Holdings, Q3 2026: revenue $321M (+40% year over year), operating margin 10.3%, net loss $42.6M, operating cash flow $161M. The chart follows the revenue to costs, profit and cash.
Questions
Is DigitalOcean Holdings being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy DigitalOcean Holdings?
A leveraged buyout at today's price plus 30% ($175.27 a share) would return about 0% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $79.23 a share (−41% against today's $134.82).
What would a takeover of DigitalOcean Holdings cost?
Takeovers in its sector paid a median premium of 30% over the share price before the deal (the middle half 12% to 31%), according to the 14 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, DigitalOcean Holdings would cost about $175.27 a share, $20.1B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.