CVC and Canada Pension Plan Investment Board team up to buy Petco from TPG and Leonard Green & Partners for $4.6n
CVC announced it has agreed a deal with Canada Pension Plan Investment Board (CPPIB) to buy US pet supplies retailer Petco for $4.6bn (£3.04bn).
CVC, the private equity giant that owns Formula One, will jointly aquire the company, which is the second largest petcare supplier in the US, from a group of investors led by TPG and Leonard Green & Partners.
An earlier merger bid from US market leader PetSmart stalled last month thanks to competition and antitrust concerns.
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James Myers, Petco’s chief executive said:
As the North American pet industry continues to grow, Petco is well positioned with a strong brand, differentiated engagement model, and omnichannel strategy.
Both CVC and CPPIB have outstanding track records and deep retail experience and resources that will help support our growth initiatives.
TPG and Leonard Green first bought the company in 2000 for $600m, and floated it in 2002, before buying it again in 2006 for $1.7bn, Reuters reported.
The deal is expected to close early next year.
“Petco is clearly a leader in the industry, with strong further growth potential and a talented leadership team,” said Chris Stadler, CVC managing partner. “The pet category is a growing and dynamic space within which we believe Petco is ideally positioned to enhance its leadership position.”
Goldman, Sachs and and JP Morgan were financial advisors to Petco. Barclays, Citigroup and Moelis acted as lead financial advisors to CVC and CPPIB. Barclays, Citigroup, Barclays, Royal Bank of Canada, Credit Suisse, Nomura and Macquarie provided debt financing to CVC and CPPIB.