Filing Flows › Innovate (VATE) › Takeover & LBO
Is Innovate (VATE) a takeover target?
A leveraged buyout at today's price plus 30% ($7.16 a share) would return about 25% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $12.81 a share (132% against today's $5.51).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $7.16 | today's $5.51 plus 30% |
| × shares | 14.0 million | |
| = Equity value | $100M | |
| + Debt refinanced | $626M | |
| − Cash | $87.8M | |
| + Other claims | $14.6M | preferred stock, minority interests |
| = Enterprise value | $653M | 6.9× EBITDA of $94.4M |
| Fees | $13.1M | 2% of the price |
| New debt | $425M | 4.5× EBITDA at 7.65% a year; the limit that binds: 65% of the price |
| Buyer's own money | $242M | 36% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $1.6B | $102M | $32.5M | $48.9M | $376M |
| Year 2 | $1.7B | $109M | $28.7M | $58.8M | $317M |
| Year 3 | $1.8B | $115M | $24.2M | $68.9M | $248M |
| Year 4 | $1.9B | $120M | $19.0M | $79.0M | $169M |
| Year 5 | $2.0B | $123M | $12.9M | $88.8M | $80.3M |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 6.7× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $823M | |
| − Debt left | $80.3M | |
| = Buyer's equity | $743M | |
| Money multiple | 3.07× | on $242M put in |
| Buyer's yearly return (IRR) | 25.2% |
Price against return
What the buyer makes at other premiums over today's $5.51; the IRR reaches 20% at $12.81 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $6.06 | 26.2% |
| 20% | $6.61 | 25.7% |
| 30% | $7.16 | 25.2% |
| 40% | $7.71 | 24.7% |
| 50% | $8.27 | 24.1% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $1.5B | |
| EBITDA, last 12 months | $94.4M | 6.2% of revenue |
| Depreciation and amortization | $29.5M | |
| Capital spending | $500K | |
| Debt | $626M | |
| Cash | $87.8M | |
| Share price | $5.51 | 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 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 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 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, Innovate would cost about $7.71 a share, $108M for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 14.7% | $6.32 | $88.3M |
| Median | 40% | $7.71 | $108M |
| High end (a quarter paid more) | 60.2% | $8.83 | $123M |
Innovate's latest quarter
Innovate, Q2 2026: revenue $422M (+74% year over year), operating margin 8.2%, net earnings $10.7M, operating cash flow −$24.6M. The chart follows the revenue to costs, profit and cash.
Questions
Is Innovate being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Innovate?
A leveraged buyout at today's price plus 30% ($7.16 a share) would return about 25% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $12.81 a share (132% against today's $5.51).
What would a takeover of Innovate 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, Innovate would cost about $7.71 a share, $108M for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.