Wed, Mar. 11, 3:26 AM
- BC Partners plans to appoint Michael Massey as chief executive of PetSmart (NASDAQ:PETM) after it completes a $8.7B acquisition of the 1,387-store chain today, WSJ reports.
- Massey, who previously served as CEO of Collective Brands, will replace David Lenhardt, who will depart with an exit package of about $24M.
- Previously: PetSmart to be acquired by BC Partners-led group for $8.7B (Dec. 14 2014)
Dec. 15, 2014, 8:14 AM
- Several investment firms think that a higher buyout offer on PetSmart (NASDAQ:PETM) is unlikely.
- SA contributor Apus Investments predicts PetSmart shareholders will approve the deal with Longview Asset Management already pledging its 9% block in favor of the transaction.
- PetSmart is the target of an investigation by a class action law firm over the slim premium (compared to Friday's closing price) it agreed to in its announced takeover.
- PETM +4.3% premarket to $81.00 - still below the deal price of $83 per share.
Dec. 14, 2014, 4:16 PM
- PetSmart (NASDAQ:PETM) has agreed to be bought by a BC Partners-led group for $8.7B, or $83/share, in the largest private-equity buyout of 2014.
- The price is 39% higher than PETM's "unaffected" closing share price on July 2, 2014.
- $8.7B is a 9.1x multiple on PETM's adjusted 12-month Ebitda.
- BC edged out rival buyout firm Apollo Global Management (NYSE:APO) in the auction.
- Underwriters: Citigroup, Nomura, Jefferies, Barclays and Deutsche Bank, have underwritten the debt package to finance the acquisition.
- Previously: Apollo Global closes in on $8B PetSmart buyout (Dec. 13), Banking issues cloud PetSmart buyout (Dec. 8)
Dec. 13, 2014, 2:16 PM
- Leon Black’s Apollo Global Management (NYSE:APO) appears to have edged out KKR (NYSE:KKR) in the final round of bidding for PetSmart (NASDAQ:PETM), NY Post says.
- A deal could be announced as soon as this weekend.
- Banks led by Barclays and Citi are arranging $6.25B in debt financing, which is more than 6.5x PETM's Ebitda, exceeding the Fed's guideline of 6x Ebitda. Sources say at least two more banks dropped out of the running in recent weeks after being warned by the Fed and the OCC about taking on excess leverage.
- Previously: Banking issues cloud PetSmart buyout (Dec. 8), Report: Banker anxiety could derail PetSmart buyout (Dec. 5), P-E firms circle around PetSmart (Dec. 3)
Nov. 19, 2014, 10:21 AM
- An acquisition of PetSmart (PETM +4.1%) by KKR and Clayton, Dubilier & Rice is more likely if the company manages to push through its $200M cost-cutting plan, reasons Wedbush.
- Despite some concerns on PetSmart's weak gross margin rate and high level of inventory, Wedbush assigns a price target of $80 to PETM as a takeover premium.
- BofA also has a $80 price target on the stock, although it likes the prospect of a PetSmart-Petco merger better than the P-E play.
- UBS is more PETM)+Q3+Report%3B+Boosts+PT+to+$77/10030390.html" target="_blank">cautious with a $77 price target and tepid Neutral rating on PetSmart, noting the Q3 traffic decline of 2.4% was a concern.
- Analyst Michael Lasser leans to the apprehensive side: "As we see it, the situation is becoming fascinating, but less analyzable."
- Previously: Q3 results, Q3 highlights, P-E firms eyeing PetSmart
Nov. 19, 2014, 2:06 AM
- As the auction for PetSmart (NASDAQ:PETM) heats up, buyout firms KKR (NYSE:KKR) and Clayton, Dubilier & Rice have teamed up to take the pet food retailer private for more than $7.5B, Reuters reports.
- Petsmart, which reported a FQ3 beat after the bell yesterday, said in August it would explore a potential sale amid pressure from Jana Partners and other activist investors.
- KKR and CD&R are planning to submit a joint bid next month. Apollo Global Management (NYSE:APO) and BC Partners are also considering offers.
- PETM +2.6% AH
Nov. 7, 2014, 12:58 PM
- P-E firms including KKR, Apollo Global Management (NYSE:APO), BC Partners and Clayton Dubilier & Rice have been invited to the final round of bidding for PetSmart (NASDAQ:PETM), WSJ reports.
- A deal to take PETM private would be the largest leveraged buyout of the year, according to data from Dealogic.
Oct. 23, 2014, 10:51 AM
- KKR (KKR +1.4%) is taking a serious look at PetSmart (PETM +0.6%), according to the New York Post.
- The investment firm has a nice track record in the pet supplier business after guiding Pets at Home to a profitable IPO.
- Firdt-round bids on PetSmart are due in by the end of the month with JPMorgan overseeing the action.
- Investors haven't really assigned a buyout premium on PETM as shares trade lower than they did three months ago.
Aug. 19, 2014, 6:18 PM
- Along with its Q2 results, PetSmart (NASDAQ:PETM) has confirmed reports it will explore strategic alternatives, including a possible sale. JPMorgan has been hired to help out.
- The company has also announced: it's buying online pet product retailer and content provider Pet360 for $130M up-front + up to $30M in earn-outs. PetSmart notes Pet360 reaches 12M+ "pet parents" per month, and that its assets include several popular pet food and content properties. The deal is expected to close in September.
- PetSmart has launched "a broad cost-reduction program" that will "target all areas of the business, including, in order of magnitude, cost of goods sold, logistics, sourcing, store operating costs and overhead." More details will be given next quarter.
- Comparable store sales fell 0.5% Y/Y in Q2. Q3 EPS guidance is at $0.93-$0.97 (consensus is at $0.94), and full-year EPS guidance is at $4.29-$4.39 (consensus is at $4.32).
- Full-year net sales are expected to grow at a low-single digit clip (consensus is at 2%), and comparable store sales are expected to be relatively flat.
- Shares are halted. Q2 results, PR.
PETM vs. ETF Alternatives
PetSmart Inc provides specialty products, services and solutions for the lifetime needs of pets in North America. It offers products for all the life stages of pets, professional grooming, training, day camp for dogs and boarding.
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