Filing Flows › Graham Holdings (GHC) › Takeover & LBO
Is Graham Holdings (GHC) a takeover target?
A leveraged buyout at today's price plus 30% ($1,580.67 a share) would return a loss of about 1% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $761.68 a share (−37% against today's $1,215.90). Historically 5.8% of companies with its figures were bought within a year (1.15× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $1,580.67 | today's $1,215.90 plus 30% |
| × shares | 4.2 million | |
| = Equity value | $6.7B | |
| + Debt refinanced | $900M | |
| − Cash | $157M | |
| = Enterprise value | $7.5B | 22.4× EBITDA of $333M |
| Fees | $149M | 2% of the price |
| New debt | $1.8B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $5.8B | 76% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $5.2B | $343M | $140M | $81.1M | $1.8B |
| Year 2 | $5.4B | $353M | $134M | $91.8M | $1.7B |
| Year 3 | $5.5B | $364M | $127M | $103M | $1.6B |
| Year 4 | $5.7B | $375M | $119M | $116M | $1.4B |
| Year 5 | $5.9B | $386M | $110M | $129M | $1.3B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 17.7× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $6.8B | |
| − Debt left | $1.3B | |
| = Buyer's equity | $5.5B | |
| Money multiple | 0.96× | on $5.8B put in |
| Buyer's yearly return (IRR) | −0.8% |
Price against return
What the buyer makes at other premiums over today's $1,215.90; the IRR reaches 20% at $761.68 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $1,337.49 | 3.2% |
| 20% | $1,459.08 | 1.1% |
| 30% | $1,580.67 | −0.8% |
| 40% | $1,702.26 | −2.5% |
| 50% | $1,823.85 | −4.1% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $5.1B | |
| EBITDA, last 12 months | $333M | 6.6% of revenue |
| Depreciation and amortization | $76.8M | |
| Capital spending | $78.8M | |
| Debt | $900M | |
| Cash | $157M | |
| Share price | $1,215.90 | on Nov 5, 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 3.0% 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 21% 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 40% over the share price before the deal (the middle half 14.7% to 60.2%), according to the 20 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Graham Holdings would cost about $1,702.26 a share, $7.2B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 14.7% | $1,394.64 | $5.9B |
| Median | 40% | $1,702.26 | $7.2B |
| High end (a quarter paid more) | 60.2% | $1,947.87 | $8.3B |
The odds, from history
Historically 5.8% of companies with its figures were bought within a year (1.15× 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.
Graham Holdings' latest quarter
Graham Holdings, Q3 2026: revenue $1.3B (+4% year over year), operating margin 6.4%, net earnings $75.1M, operating cash flow $160M. The chart follows the revenue to costs, profit and cash.
Questions
Is Graham Holdings being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Graham Holdings?
A leveraged buyout at today's price plus 30% ($1,580.67 a share) would return a loss of about 1% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $761.68 a share (−37% against today's $1,215.90).
What would a takeover of Graham Holdings cost?
Takeovers in its sector paid a median premium of 40% over the share price before the deal (the middle half 14.7% to 60.2%), according to the 20 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Graham Holdings would cost about $1,702.26 a share, $7.2B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.