On Jan. 8 pet health and wellness company Pet IQ announced that it had entered into a definitive agreement to acquire VIP Petcare, a leading veterinary services provider across the US. The transaction, valued at approximately $220 million, is expected to close by the end of January 2018.
“We look forward to working closely with Will Santana, CEO of VIP, who will be joining the PetIQ board of directors as well as our senior management team in connection with the closing of the transaction, and to welcoming the entire VIP team to the PetIQ family,” said Cord Christensen, PetIQ Chairman and CEO. “The addition of VIP will give us a national footprint in the veterinarian services segment and the opportunity to participate in an approximately $21 billion market in the US,” Santana added.
PetIQ and VIP are expected to generate approximately $450 million to $500 million of pro-forma net sales and approximately $40 million to $45 million of pro-forma adjusted EBITDA for the calendar year ending December 31, 2018, which adjusts for the impact of elimination of VIP’s sales to PetIQ.
In 2017 VIP Petcare treated more than 1 million pets through 2,900 community clinics and wellness centers hosted at local pet retailers across 31 states as well as its 76,000 mobile clinics.
The acquisition is expected to further diversify PetIQ’s current net sales mix, with the combined veterinarian products business representing approximately 75 percent of net sales and the services business representing approximately 25 percent of net sales, based on aforementioned pro forma net sales for the calendar year ending Dec. 31, 2018.