Filing Flows › Strategic Education (STRA) › Takeover & LBO
Is Strategic Education (STRA) a takeover target?
A leveraged buyout at today's price plus 30% ($94.85 a share) would return about 3% a year to a private-equity buyer over 5 years; no price, however low, gets a buyer to 20%. Historically 3.9% of companies with its figures were bought within a year (0.77× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $94.85 | today's $72.96 plus 30% |
| × shares | 21.7 million | |
| = Equity value | $2.1B | |
| + Debt refinanced | $0 | |
| − Cash | $129M | |
| = Enterprise value | $1.9B | 8.5× EBITDA of $228M |
| Fees | $38.7M | 2% of the price |
| New debt | $1.3B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $720M | 37% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $1.3B | $236M | $95.8M | $61.9M | $1.2B |
| Year 2 | $1.4B | $244M | $91.0M | $70.0M | $1.1B |
| Year 3 | $1.4B | $252M | $85.7M | $78.5M | $1.0B |
| Year 4 | $1.5B | $259M | $79.7M | $87.5M | $954M |
| Year 5 | $1.5B | $267M | $73.0M | $97.0M | $857M |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 6.4× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $1.7B | |
| − Debt left | $857M | |
| = Buyer's equity | $854M | |
| Money multiple | 1.19× | on $720M put in |
| Buyer's yearly return (IRR) | 3.5% |
Price against return
What the buyer makes at other premiums over today's $72.96.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $80.26 | 13.4% |
| 20% | $87.55 | 8.4% |
| 30% | $94.85 | 3.5% |
| 40% | $102.14 | −0.6% |
| 50% | $109.44 | −3.9% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $1.3B | |
| EBITDA, last 12 months | $228M | 17.7% of revenue |
| Depreciation and amortization | $47.3M | |
| Capital spending | $47.3M | |
| Debt | $0 | |
| Cash | $129M | |
| Share price | $72.96 | on Oct 30, 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 3.5% 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 27% 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, Strategic Education would cost about $102.14 a share, $2.2B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 14.7% | $83.69 | $1.8B |
| Median | 40% | $102.14 | $2.2B |
| High end (a quarter paid more) | 60.2% | $116.88 | $2.5B |
The odds, from history
Historically 3.9% of companies with its figures were bought within a year (0.77× 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.
Strategic Education's latest quarter
Strategic Education, Q3 2026: revenue $325M (+2% year over year), operating margin -26.9%, net loss $98.3M, operating cash flow $56.9M. The chart follows the revenue to costs, profit and cash.
Questions
Is Strategic Education being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Strategic Education?
A leveraged buyout at today's price plus 30% ($94.85 a share) would return about 3% a year to a private-equity buyer over 5 years; no price, however low, gets a buyer to 20%.
What would a takeover of Strategic Education 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, Strategic Education would cost about $102.14 a share, $2.2B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.