PE firms continue their walk in to the world of pets

March this year saw Kohlberg Kravis & Roberts (KKR), the US private equity firm, sell a 40 per cent stake in the UK pet retailer Pets at Home via an IPO listing on the London Stock Exchange, the deal raised USD 815m, valuing the total business at over USD 2bn. Yesterday saw KKR and Clayton Dubilier & Rice (CD&R) linked to potential de-listing and take private of the listed US based pet retailer, PetSmart.  Media reports place a potential deal value of USD 7.5bn on the company and not un-surprisingly other PE firms, such as BC Partners and Apollo Global Management have also been linked as possible suitors for the company.

Pets are now seriously big business and I can personally testify to this given the imminent arrival of a new puppy in my household and the pre-arrival shopping list that is accompanying the new little fellow. The American Pet Products Association claimed that in the US alone, expenditure on pets annually has reached USD 55.7bn, with the equally pet crazy Brits spending over GBP 15bn a year.

Its therefore not un-surprising then that there have been a number of private equity investments in to companies that operate in the market of pet products and the increasing market for whole some and fresh pet foods.

Having paid USD 1.4bn for Pets at Home in 2010 and having sold 40 per cent for USD 815m, it’s no surprise that KKR are being linked to PetSmart as they have already successfully taken a walk in the world of pets.