Filing Flows › Progress Software (PRGS) › Takeover & LBO
Is Progress Software (PRGS) a takeover target?
A leveraged buyout at today's price plus 30% ($50.69 a share) would return about 6% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $25.54 a share (−35% against today's $38.99). It already carries 6.1× EBITDA in net debt (the model flags anything over 6×), so a buyer could add little debt of its own. Historically 4.1% of companies with its figures were bought within a year (0.81× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $50.69 | today's $38.99 plus 30% |
| × shares | 41.5 million | |
| = Equity value | $2.1B | |
| + Debt refinanced | $1.2B | |
| − Cash | $114M | |
| = Enterprise value | $3.2B | 17.6× EBITDA of $183M |
| Fees | $64.4M | 2% of the price |
| New debt | $1.0B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $2.3B | 69% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $1.1B | $194M | $76.8M | $88.0M | $916M |
| Year 2 | $1.1B | $205M | $70.1M | $103M | $813M |
| Year 3 | $1.2B | $215M | $62.2M | $119M | $694M |
| Year 4 | $1.2B | $223M | $53.1M | $135M | $560M |
| Year 5 | $1.3B | $230M | $42.8M | $150M | $409M |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 15.0× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $3.4B | |
| − Debt left | $409M | |
| = Buyer's equity | $3.0B | |
| Money multiple | 1.33× | on $2.3B put in |
| Buyer's yearly return (IRR) | 5.8% |
Price against return
What the buyer makes at other premiums over today's $38.99; the IRR reaches 20% at $25.54 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $42.89 | 9.2% |
| 20% | $46.79 | 7.4% |
| 30% | $50.69 | 5.8% |
| 40% | $54.59 | 4.4% |
| 50% | $58.48 | 3.0% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $1.0B | |
| EBITDA, last 12 months | $183M | 18.3% of revenue |
| Depreciation and amortization | $6.0M | |
| Capital spending | $9.1M | |
| Debt | $1.2B | |
| Cash | $114M | |
| Share price | $38.99 | on Oct 12, 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 6.4% 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, Progress Software would cost about $50.69 a share, $2.1B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 12% | $43.67 | $1.8B |
| Median | 30% | $50.69 | $2.1B |
| High end (a quarter paid more) | 31% | $51.08 | $2.1B |
The odds, from history
Historically 4.1% of companies with its figures were bought within a year (0.81× the average). Its figures put it in decile 4 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.
Progress Software's latest quarter
Progress Software, Q3 FY26: revenue $246M (-2% year over year), operating margin 18.9%, net earnings $22.8M, operating cash flow $88.0M. The chart follows the revenue to costs, profit and cash.
Questions
Is Progress Software being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Progress Software?
A leveraged buyout at today's price plus 30% ($50.69 a share) would return about 6% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $25.54 a share (−35% against today's $38.99). It already carries 6.1× EBITDA in net debt (the model flags anything over 6×), so a buyer could add little debt of its own.
What would a takeover of Progress Software 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, Progress Software would cost about $50.69 a share, $2.1B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.