Private Equity Firm, Apollo Global Management, Commits Capital in PetSmart's Equity
Hear Ye, Hear Ye:
PetSmart, the popular pet retailer, has secured a new partner – Apollo Global Management. The partnership, set to close in Q4, had the details kept under wraps. PetSmart's majority shareholder, BC Partners (who scooped it up for about $8.7 billion back in 2015), will remain in control, alongside co-investors GIC and the PetSmart management team.
Under BC Partners' reign, PetSmart's revenue has skyrocketed by over 40%. Apollo's investment is a vote of confidence in PetSmart, recognizing its "continued growth opportunity" in the market. This growth is largely driven by the ever-growing trend of pet ownership and the rising focus on animal wellness across the U.S.
Why is PetSmart a prime contender for success? Its diverse offerings set it apart from the competition. Apart from your standard pet supplies, PetSmart provides veterinary services, grooming, training, and proprietary brands. In 2017, it even expanded its digital footprint with the acquisition of online pet retailer Chewy for $3.35 billion.
Currently, PetSmart operates over 1,660 stores in the U.S., Puerto Rico, and Canada. It also runs more than 200 dog and cat boarding facilities and has dipped its paws into the pet healthcare sector with a 2021 online pharmacy launch.
"The fusion of BC Partners' wisdom and Apollo's clout offers even more avenues for unlocking value as PetSmart steps into its next phase of expansion," said J.K. Symancyk, PetSmart's CEO.
With Apollo's $598 billion in assets under management (as of March 31), it's no wonder they're eager to support PetSmart's growth. "We embrace PetSmart's management team and store associates, as well as their innovative strategy, operating model, and adaptability throughout market fluctuations," noted Andrew Jhawar, an Apollo partner.
Rumor has it that BC Partners is set to realize a staggering three times the return on their initial investment. Exciting times are ahead for the PetSmart team!
- The fusion of BC Partners' wisdom and Apollo's clout could potentially unlock three times the return on investment for the business, as PetSmart steps into its next phase of expansion, driven by the growth in pet ownership and the rising focus on pet wellness.
- With Apollo Global Management, an investor managing $598 billion in assets under management, now as PetSmart's partner, the health and wellness of pets, especially dogs and cats, are anticipated to receive further support, given Apollo's recognition of PetSmart's growth potential.
- While war in financial markets is often concerned with securing the best returns, the partnership between PetSmart and Apollo Global Management can be seen as a victory for both businesses, as they shareholder interests align in their focus on pet retail, veterinary services, and pet wellness.
- The AI used in PetSmart's retail and digital operations provides a unique edge, further setting it apart from competitors in the pet industry by enhancing customer experiences, streamlining inventory management, and promoting pet wellness.
- Given PetSmart's success in the market, especially its services beyond pet supplies, such as veterinary care, grooming, training, and its innovative digital strategies, it has become a prime example of a well-rounded business model that benefits its shareholders, employees, and the pet community alike.
