Woolworths to take majority stake in pet food retailer Petspiration
Woolworths, an Australian trans-Tasman retailer, has agreed to acquire 55% of interest in Petspiration, a pet food retailer, for an enterprise value of approximately AUD 1.7 billion, assuming net debt of around AUD 670 million.
The acquisition is expected to increase Woolworths’ presence in the pet retail space.
Petspiration owns and runs PETstock, a retail brand with a chain of 276 stores and established eCommerce platforms like Pet.co.nz.
The pet food retailer also has personal brands such as Caribu and Glow as well as a 2.4-million-member Petspiration loyalty program.
Brad Banducci — Woolworths CEO said: “Specialty pet is a large and growing retail segment in which we have limited presence.
“The partnership will allow us to meet more of our customers’ pet family needs with a complementary range of specialty pet products and services, strengthen the Everyday Rewards loyalty program and unlock opportunities for material value creation across both businesses.
“We will work together to support Petspiration’s growth through access to our retail capabilities in areas such as Digital and eCommerce, Supply Chain, Retail Media, Format and Network Development, and Advanced Analytics.”
Woolworths to take majority stake in pet food retailer Petspiration. Photo courtesy of Petspiration.
Founders Shane Young and David Young will continue as CEO and Managing Director, respectively, and together with existing shareholders will retain a 45% stake in the business.
Petspiration will be operated as a standalone business within Woolworths Group, with a separate board and governance structure.
Shane Young said: “We will operate independently of Woolworths Group but will work closely together through our common values to deliver on all the opportunities we have to jointly create value for our pet families and supplier partners.”
With last twelve months ended 30 September 2022 sales of AUD 979 million, Petspiration is said to have delivered remarkable sales growth for the last five years.
The transaction is expected to close in mid-calendar 2023, subject to regulatory and customary closing conditions.
In 2002, brothers David Young and Shane Young founded The PETstock franchise in Australia.