Filing Flows › Xylem (XYL) › Takeover & LBO
Is Xylem (XYL) a takeover target?
A leveraged buyout at today's price plus 30% ($127.26 a share) would return a loss of about 0% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $70.42 a share (−28% against today's $97.89). Historically 2.0% of companies with its figures were bought within a year (0.4× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $127.26 | today's $97.89 plus 30% |
| × shares | 233.0 million | |
| = Equity value | $29.7B | |
| + Debt refinanced | $3.5B | |
| − Cash | $708M | |
| + Other claims | $3.0M | preferred stock, minority interests |
| = Enterprise value | $32.4B | 16.8× EBITDA of $1.9B |
| Fees | $648M | 2% of the price |
| New debt | $10.6B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $22.4B | 68% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $9.2B | $2.0B | $813M | $658M | $10.0B |
| Year 2 | $9.4B | $2.0B | $763M | $723M | $9.2B |
| Year 3 | $9.7B | $2.1B | $707M | $796M | $8.4B |
| Year 4 | $9.9B | $2.1B | $646M | $878M | $7.6B |
| Year 5 | $10.2B | $2.2B | $579M | $970M | $6.6B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 13.2× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $28.8B | |
| − Debt left | $6.6B | |
| = Buyer's equity | $22.2B | |
| Money multiple | 0.99× | on $22.4B put in |
| Buyer's yearly return (IRR) | −0.2% |
Price against return
What the buyer makes at other premiums over today's $97.89; the IRR reaches 20% at $70.42 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $107.68 | 4.6% |
| 20% | $117.47 | 2.0% |
| 30% | $127.26 | −0.2% |
| 40% | $137.05 | −2.1% |
| 50% | $146.84 | −3.9% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $9.1B | |
| EBITDA, last 12 months | $1.9B | 21.3% of revenue |
| Depreciation and amortization | $560M | |
| Capital spending | $351M | |
| Debt | $3.5B | |
| Cash | $708M | |
| Share price | $97.89 | 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 1.9% 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, Xylem would cost about $137.05 a share, $31.9B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 14.7% | $112.28 | $26.2B |
| Median | 40% | $137.05 | $31.9B |
| High end (a quarter paid more) | 60.2% | $156.82 | $36.5B |
The odds, from history
Historically 2.0% of companies with its figures were bought within a year (0.4× the average). Its figures put it in decile 1 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.
Xylem's latest quarter
Xylem, Q3 2026: revenue $2.2B (-3% year over year), operating margin 17.5%, net earnings $291M, operating cash flow $331M. The chart follows the revenue to costs, profit and cash.
Questions
Is Xylem being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Xylem?
A leveraged buyout at today's price plus 30% ($127.26 a share) would return a loss of about 0% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $70.42 a share (−28% against today's $97.89).
What would a takeover of Xylem 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, Xylem would cost about $137.05 a share, $31.9B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.