Filing Flows › Smithfield Foods (SFD) › Takeover & LBO
Is Smithfield Foods (SFD) a takeover target?
A leveraged buyout at today's price plus 30% ($25.48 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 $17.64 a share (−10% against today's $19.60). Historically 4.5% of companies with its figures were bought within a year (0.89× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $25.48 | today's $19.60 plus 30% |
| × shares | 394.9 million | |
| = Equity value | $10.1B | |
| + Debt refinanced | $2.0B | |
| − Cash | $1.2B | |
| = Enterprise value | $10.9B | 7.3× EBITDA of $1.5B |
| Fees | $217M | 2% of the price |
| New debt | $7.1B | 4.7× EBITDA at 7.65% a year; the limit that binds: 65% of the price |
| Buyer's own money | $4.0B | 36% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $15.1B | $1.5B | $541M | $435M | $6.6B |
| Year 2 | $15.1B | $1.5B | $507M | $460M | $6.2B |
| Year 3 | $15.3B | $1.5B | $472M | $484M | $5.7B |
| Year 4 | $15.6B | $1.5B | $435M | $517M | $5.2B |
| Year 5 | $16.1B | $1.6B | $395M | $560M | $4.6B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 5.7× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $9.1B | |
| − Debt left | $4.6B | |
| = Buyer's equity | $4.5B | |
| Money multiple | 1.11× | on $4.0B put in |
| Buyer's yearly return (IRR) | 2.1% |
Price against return
What the buyer makes at other premiums over today's $19.60; the IRR reaches 20% at $17.64 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $21.56 | 11.0% |
| 20% | $23.52 | 6.6% |
| 30% | $25.48 | 2.1% |
| 40% | $27.44 | −2.5% |
| 50% | $29.40 | −7.5% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $15.2B | |
| EBITDA, last 12 months | $1.5B | 9.8% of revenue |
| Depreciation and amortization | $338M | |
| Capital spending | $376M | |
| Debt | $2.0B | |
| Cash | $1.2B | |
| Share price | $19.60 | 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 -0.6% 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 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, Smithfield Foods would cost about $25.97 a share, $10.3B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 20% | $23.52 | $9.3B |
| Median | 32.5% | $25.97 | $10.3B |
| High end (a quarter paid more) | 51.8% | $29.75 | $11.7B |
The odds, from history
Historically 4.5% of companies with its figures were bought within a year (0.89× the average). Its figures put it in decile 5 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.
Smithfield Foods' latest quarter
Smithfield Foods, Q3 2026: revenue $3.4B (-8% year over year), operating margin 3.7%, net earnings $89.0M, operating cash flow $161M. The chart follows the revenue to costs, profit and cash.
Questions
Is Smithfield Foods being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Smithfield Foods?
A leveraged buyout at today's price plus 30% ($25.48 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 $17.64 a share (−10% against today's $19.60).
What would a takeover of Smithfield Foods 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, Smithfield Foods would cost about $25.97 a share, $10.3B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.