Filing Flows › Intercontinental Hotels Group (IHG) › Takeover & LBO
Is Intercontinental Hotels Group (IHG) a takeover target?
A leveraged buyout at today's price plus 30% ($232.38 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 $114.64 a share (−36% against today's $178.75).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $232.38 | today's $178.75 plus 30% |
| × shares | 164.7 million | |
| = Equity value | $38.3B | |
| + Debt refinanced | $0 | |
| − Cash | $180M | |
| = Enterprise value | $38.1B | 30.1× EBITDA of $1.3B |
| Fees | $762M | 2% of the price |
| New debt | $7.0B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $31.9B | 82% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $5.3B | $1.3B | $532M | $520M | $6.4B |
| Year 2 | $5.5B | $1.3B | $492M | $576M | $5.9B |
| Year 3 | $5.7B | $1.4B | $448M | $634M | $5.2B |
| Year 4 | $5.8B | $1.4B | $400M | $697M | $4.5B |
| Year 5 | $6.0B | $1.5B | $347M | $764M | $3.8B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 23.1× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $33.9B | |
| − Debt left | $3.8B | |
| = Buyer's equity | $30.2B | |
| Money multiple | 0.95× | on $31.9B put in |
| Buyer's yearly return (IRR) | −1.1% |
Price against return
What the buyer makes at other premiums over today's $178.75; the IRR reaches 20% at $114.64 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $196.63 | 3.1% |
| 20% | $214.50 | 0.9% |
| 30% | $232.38 | −1.1% |
| 40% | $250.25 | −2.9% |
| 50% | $268.12 | −4.5% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $5.2B | |
| EBITDA, last 12 months | $1.3B | 24.4% of revenue |
| Depreciation and amortization | $67.0M | |
| Capital spending | $28.0M | |
| Debt | $0 | |
| Cash | $180M | |
| Share price | $178.75 | on Nov 6, 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 29% 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, Intercontinental Hotels Group would cost about $236.84 a share, $39.0B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 20% | $214.50 | $35.3B |
| Median | 32.5% | $236.84 | $39.0B |
| High end (a quarter paid more) | 51.8% | $271.34 | $44.7B |
Intercontinental Hotels Group's latest quarter
Intercontinental Hotels Group, H1 2026: revenue $2.7B (+6% year over year), operating margin 25.2%, net earnings $425M, operating cash flow $355M. The chart follows the revenue to costs, profit and cash.
Questions
Is Intercontinental Hotels Group being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Intercontinental Hotels Group?
A leveraged buyout at today's price plus 30% ($232.38 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 $114.64 a share (−36% against today's $178.75).
What would a takeover of Intercontinental Hotels Group 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, Intercontinental Hotels Group would cost about $236.84 a share, $39.0B for all its shares.
Updated Nov 9, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.