From $6.00 to $8.05: How a Special Committee Priced a CEO's Buyout

Priority Technology Holdings announced on Monday that it will go private in a $1.6 billion enterprise value transaction led by its own chairman and chief executive, Thomas Priore, with equity from Searchlight Capital Partners. Public stockholders will receive $8.05 per share in cash. The opening proposal, made in November 2025, was $6.00 to $6.15. The difference, a price increase of more than 30 percent, was negotiated by a committee of independent directors who had no ability to sell the company to anyone else, because the buyer had already said he would not sell his stake. For business owners, the deal is a compact lesson in how a price gets set when the buyer is already inside the building.

Why an insider buyout is a different negotiation

Most sale processes rely on competition: several buyers bid, and the seller's leverage comes from the ability to walk to the next name on the list. An insider buyout removes that lever. Priore and his affiliates controlled roughly 60 percent of Priority's shares, and in a Schedule 13D filed in December 2025 he informed the board that he did not intend to sell that stake to any third party. No outside buyer could acquire the company without him, so the customary threat of a competing bid was off the table before the first counteroffer.

That leaves the minority holders with one protection: process. Priority's board formed a special committee of independent and disinterested directors, and that committee retained its own financial adviser (Barclays) and its own legal counsel (Paul, Weiss). The committee's job was to negotiate as if it were the seller, with the buyer's own management team on the other side of the table and unable to be replaced.

The same structure appears, in smaller form, whenever a private company's majority owner offers to buy out a partner, a management team proposes to buy the business from a founder, or one branch of a family wants to purchase another's shares. The buyer knows more about the business than the seller, controls its operations, and often controls the information the seller sees. The remedy is the same: an independent decision-maker, independent advisers, and a valuation that does not depend on the buyer's numbers.

What the unaffected price is, and why it matters

Priority's announcement quotes two premiums. The $8.05 price is 65 percent above the closing price on November 7, 2025, the last trading day before the initial proposal became public, and 38 percent above the closing price on September 18, 2026, the last trading day before the definitive agreement. The first number is measured against the unaffected price: what the market thought the shares were worth before anyone knew a buyout was coming. Once a proposal is public, the stock trades on the expected deal price rather than on the business, so later premiums say less.

Working backward from the 65 percent figure, the unaffected price was about $4.88. The opening proposal of $6.00 to $6.15 was therefore a premium of roughly 23 to 26 percent, which is in the normal range for public deals. The committee's negotiation nearly tripled that premium.

Private companies have no ticker, but they do have an equivalent problem. A majority owner who proposes a buyout after a weak quarter, or after the company has deferred a price increase or delayed a hire, is setting the reference point in his own favor. The private-company version of the unaffected price is a valuation performed on normalized earnings (profits adjusted to remove one-time items and owner-driven timing decisions) as of a date before the buyout conversation started. That is the number a minority owner should insist on as the starting line.

The gap between the two sides' numbers

The record here is unusually public. Ten days after the initial proposal, Buckley Capital Advisors, which held about 2.2 percent of the shares, sent the board a letter calling the offer opportunistic and laying out a sum-of-the-parts analysis (valuing each business segment separately and adding them up) that arrived at $15 to $20 per share, with a point estimate of $17.24. Buckley also noted that sell-side analysts covering the stock had price targets between $9 and $13.

The final price of $8.05 landed below all of those figures. On the company's own 2026 guidance of $230 million to $245 million in adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization, the standard measure of operating cash profit used in deal pricing), the $1.6 billion enterprise value works out to roughly 6.7 times the midpoint. For a payments and banking software company growing revenue at 9.4 percent, as Priority did in the second quarter, that is a modest multiple.

Whether the committee got the best available price is a question the proxy statement and the Rule 13e-3 disclosure (a filing required in going-private deals that describes the process, the alternatives considered, and the fairness analysis) will answer in detail. What the public record already shows is the shape of the negotiation: an anchored opening offer, a vocal minority holder with a much higher number, a committee that could not run an auction, and a settlement about a third above the opening bid.

In a conflicted buyout, the seller's advisers rarely get to the seller's aspirational number. What they can do is move the price materially off the buyer's anchor and build a record that the process was fair. The price is what the minority receives; the record is what protects everyone, including the buyer, from later claims that the deal was one-sided.

Protections the deal includes, and what they mean privately

Three features of the Priority agreement translate directly into private-company terms.

The first is the majority-of-the-minority vote. The transaction requires approval from a majority of shares not held by the investor group. Priore's 60 percent cannot carry the vote on its own; the unaffiliated holders decide. In a private buyout, the equivalent is a consent requirement from the non-buying owners, written into the shareholders' agreement or negotiated into the buyout itself, so that the person with control does not also get to approve his own purchase.

The second is the committee's independent valuation work. Barclays will deliver a fairness opinion, a formal statement that the consideration is fair to the unaffiliated holders from a financial point of view, supported by discounted cash flow, comparable company, and precedent transaction analyses. A private company does not need an investment bank for this. It needs an independent valuation firm engaged by the selling side, not the buying side, working from financial statements it has been allowed to test.

The third is financing certainty. Searchlight's equity commitment means the deal carries no financing condition; the buyer cannot walk if credit markets move. In private buyouts, particularly management buyouts financed by seller notes or bank debt, the seller should ask the same question: is the money committed, and what happens to the price if it is not.

What to watch as the deal moves forward

The proxy statement will show what the committee's bankers concluded, how many rounds of negotiation it took to reach $8.05, and whether any third party expressed interest despite the controlling holder's position. The unaffiliated shareholder vote, expected before a first-half 2027 close, will test whether $8.05 satisfies holders who were told the stock was worth twice that. The deal also joins a run of 2026 take-privates (Baldwin, Mistras) in which buyers with long horizons paid for companies the public market had priced for the short term.