PetIQ to buy VIP Petcare for $220 million
The sale will bring VIP’s mobile clinics and PetIQ’s pet products under one owner.
PetIQ, a manufacturer and distributor of retail pet products, is entering veterinary care with the $220 million takeover of VIP Petcare.
The transaction was announced Jan. 8 and is expected to close by late January.
VIP Petcare’s community clinics provide low-level services such as vaccinations and microchipping at hundreds of feed and pet stores in 31 states. The mobile clinics, staffed by contract veterinarians, are open a few days a month or less, while the Windsor, California, company’s 10 permanent Wellness Centers operate Monday through Friday inside partner pet stores.
VIP reported serving more than 1 million pets in 2017.
PetIQ, headquartered in Eagle, Idaho, will achieve two revenue streams — veterinary care and product sales — at each retail location. Among the company’s branded products are:
- Advecta and PetLock flea and tick preventives.
- PetAction Plus flea preventives.
- VetIQ supplements.
- Betsy Farms, Vera and Mimi’s Market dog treats.
- Delightibles cat treats.
The acquisition is expected to boost PetIQ’s 2018 net sales to $450 million to $500 million — 75 percent from products and 25 percent from veterinary services.
“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 United States,” said Cord Christensen, PetIQ’s chairman and CEO. “PetIQ has focused on providing pet owners convenient access and affordable choices to a broad portfolio of pet health and wellness products across its network of retailers, and with this acquisition, we will now be able to provide the same convenience and affordability with veterinarian care.”
VIP Petcare will operate as a subsidiary of PetIQ and co-founder Will Santana will serve on the PetIQ board of directors and in senior management.
The $220 million transaction includes $100 million in cash, $90 million in PetIQ stock and $30 million in promissory notes.