Mister Car Wash confirmed terms for a take-private transaction that will see Leonard Green & Partners purchase the remaining publicly held shares at $7 apiece in an all-cash deal. Leonard Green already controls 67% of the company, and the proposed acquisition values the chain at about $3.1 billion when accounting for roughly $770 million of net debt.
The purchase price equates to about 9 times the company's last twelve months EBITDA of $345 million. News of the transaction sent the stock higher by roughly 16% on the trading session following the announcement.
Market analysts immediately adjusted their ratings. Guggenheim moved its recommendation from Buy to Neutral and removed its price target. The firm observed that the public equity market has not embraced the conveyorized car wash model since the company’s $15 initial public offering in 2021, and noted the $7 offer is below its prior $8 target. Guggenheim said a privatization appears sensible in light of sustained share price weakness and a relatively modest public float that limited investor engagement.
Guggenheim also commented on competitive dynamics within the sector, suggesting that financial stress among some rivals could create an opening for Mister Car Wash to expand units and increase marketing investment. Those actions, the firm said, could weigh on near-term profitability but would be simpler to carry out away from public markets.
Mizuho echoed the downgrade decision, cutting its rating to Neutral and lowering its price target to $7 to reflect the transaction price. The bank indicated that the prospects for a competing bid appear low. The acquisition, which received approval from independent members of the board, is expected to close in the first half of 2026.
Both Guggenheim and Mizuho highlighted that the take-private structure would afford management and owners more latitude to invest in new locations and technology, and to pursue acquisitions or portfolio adjustments without the constraints of quarterly earnings scrutiny.
Background on valuation and immediate market reaction:
- The deal price: $7 per share in cash.
- Implied enterprise valuation: about $3.1 billion, including approximately $770 million of net debt.
- Valuation multiple: roughly 9 times LTM EBITDA of $345 million.
- Market reaction: shares rose about 16% after the announcement.
This transaction signals the end of Mister Car Wash's run as a publicly traded firm for the foreseeable future and transfers control of strategic decisions to its majority private equity owner and consortium partners, subject to customary closing conditions and regulatory approvals tied to the expected first-half-2026 timetable.