Filing Flows › Moody's (MCO) › Takeover & LBO
Is Moody's (MCO) a takeover target?
A leveraged buyout at today's price plus 30% ($667.67 a share) would return about 2% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $353.92 a share (−31% against today's $513.59). At $121.1B it would be larger than any buyout on record (the model flags anything over $60 billion), so this is a thought experiment more than a prospect. Historically 3.3% of companies with its figures were bought within a year (0.66× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $667.67 | today's $513.59 plus 30% |
| × shares | 173.3 million | |
| = Equity value | $115.7B | |
| + Debt refinanced | $6.9B | |
| − Cash | $1.6B | |
| + Other claims | $144M | preferred stock, minority interests |
| = Enterprise value | $121.1B | 29.3× EBITDA of $4.1B |
| Fees | $2.4B | 2% of the price |
| New debt | $22.8B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $100.8B | 82% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $8.8B | $4.5B | $1.7B | $1.8B | $21.0B |
| Year 2 | $9.4B | $4.8B | $1.6B | $2.1B | $18.8B |
| Year 3 | $9.9B | $5.0B | $1.4B | $2.5B | $16.4B |
| Year 4 | $10.4B | $5.2B | $1.3B | $2.8B | $13.6B |
| Year 5 | $10.7B | $5.4B | $1.0B | $3.1B | $10.5B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 22.8× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $123.3B | |
| − Debt left | $10.5B | |
| = Buyer's equity | $112.8B | |
| Money multiple | 1.12× | on $100.8B put in |
| Buyer's yearly return (IRR) | 2.3% |
Price against return
What the buyer makes at other premiums over today's $513.59; the IRR reaches 20% at $353.92 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $564.95 | 6.4% |
| 20% | $616.31 | 4.2% |
| 30% | $667.67 | 2.3% |
| 40% | $719.03 | 0.5% |
| 50% | $770.38 | −1.1% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $8.2B | |
| EBITDA, last 12 months | $4.1B | 50.6% of revenue |
| Depreciation and amortization | $496M | |
| Capital spending | $352M | |
| Debt | $6.9B | |
| Cash | $1.6B | |
| Share price | $513.59 | 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 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 22% 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, Moody's would cost about $719.03 a share, $124.6B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 14.7% | $589.09 | $102.1B |
| Median | 40% | $719.03 | $124.6B |
| High end (a quarter paid more) | 60.2% | $822.77 | $142.6B |
The odds, from history
Historically 3.3% of companies with its figures were bought within a year (0.66× 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.
Moody's latest quarter
Moody's, Q3 2026: revenue $2.0B (+0.8% year over year), operating margin 44.8%, net earnings $736M, operating cash flow $753M. The chart follows the revenue to costs, profit and cash.
Questions
Is Moody's being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Moody's?
A leveraged buyout at today's price plus 30% ($667.67 a share) would return about 2% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $353.92 a share (−31% against today's $513.59). At $121.1B it would be larger than any buyout on record (the model flags anything over $60 billion), so this is a thought experiment more than a prospect.
What would a takeover of Moody's 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, Moody's would cost about $719.03 a share, $124.6B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.