Filing Flows › Workday (WDAY) › Takeover & LBO
Is Workday (WDAY) a takeover target?
A leveraged buyout at today's price plus 30% ($253.71 a share) would return about 1% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $125.69 a share (−36% against today's $195.16). At $62.1B 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 2.5% of companies with its figures were bought within a year (0.51× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $253.71 | today's $195.16 plus 30% |
| × shares | 246.3 million | |
| = Equity value | $62.5B | |
| + Debt refinanced | $3.0B | |
| − Cash | $3.4B | |
| = Enterprise value | $62.1B | 44.2× EBITDA of $1.4B |
| Fees | $1.2B | 2% of the price |
| New debt | $7.7B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $55.6B | 88% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $11.0B | $1.5B | $592M | $520M | $7.2B |
| Year 2 | $11.7B | $1.6B | $552M | $638M | $6.6B |
| Year 3 | $12.4B | $1.7B | $503M | $757M | $5.8B |
| Year 4 | $12.9B | $1.8B | $445M | $873M | $4.9B |
| Year 5 | $13.3B | $1.8B | $378M | $985M | $4.0B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 33.9× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $62.2B | |
| − Debt left | $4.0B | |
| = Buyer's equity | $58.3B | |
| Money multiple | 1.05× | on $55.6B put in |
| Buyer's yearly return (IRR) | 1.0% |
Price against return
What the buyer makes at other premiums over today's $195.16; the IRR reaches 20% at $125.69 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $214.68 | 4.9% |
| 20% | $234.19 | 2.8% |
| 30% | $253.71 | 1.0% |
| 40% | $273.22 | −0.7% |
| 50% | $292.74 | −2.3% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $10.2B | |
| EBITDA, last 12 months | $1.4B | 13.8% of revenue |
| Depreciation and amortization | $322M | |
| Capital spending | $237M | |
| Debt | $3.0B | |
| Cash | $3.4B | |
| Share price | $195.16 | 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 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 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, Workday would cost about $253.71 a share, $62.5B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 12% | $218.58 | $53.8B |
| Median | 30% | $253.71 | $62.5B |
| High end (a quarter paid more) | 31% | $255.66 | $63.0B |
The odds, from history
Historically 2.5% of companies with its figures were bought within a year (0.51× the average). Its figures put it in decile 2 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.
Workday's latest quarter
Workday, Q2 FY27: revenue $2.6B (+13% year over year), operating margin 11.8%, net earnings $632M, operating cash flow $519M. The chart follows the revenue to costs, profit and cash.
Questions
Is Workday being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Workday?
A leveraged buyout at today's price plus 30% ($253.71 a share) would return about 1% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $125.69 a share (−36% against today's $195.16). At $62.1B 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 Workday 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, Workday would cost about $253.71 a share, $62.5B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.