Woolworths Group has taken control of pet retail chain Petspiration, acquiring a 55 per cent stake in the company valued at $586 million.
Petspiration owns and operates several businesses, including retail brand PetStock, which has a network of 276 stores, e-commerce platforms such as Pet.co.nz, with a 2.4 million member loyalty program, and a range of own-brand products under labels including Caribu and Glow.
Existing shareholders, including Shane and David Young, will retain a 45 per cent stake in the business and remain as CEO and MD, respectively. They will continue to operate Petspiration as a stand-alone business within Woolworths Group with a separate board and leadership structure.
Von Ingram of Woolworths Group will assume responsibility to “bring the partnership to life and unlock value creation opportunities” across the group, according to a statement by Woolworths.
“This is a unique opportunity to partner with Woolworths Group to continue to grow and strengthen the business we founded in Ballarat just over 30 years ago,” said Shane Young.
“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 create value for our pet families and supplier partners.”
Brad Banducci, CEO of Woolworths Group, said the company had until now a limited presence in the specialty pet retail segment and is delighted to invest alongside Petspiration’s founders.
“Specialty pet is a logical adjacency given the high penetration of pet ownership across Australia and New Zealand,” he explained.
Banducci added that Woolworths would support Petspiration’s growth in digital and e-commerce, retail media, supply chain, frame and network development, and advanced analytics.
“We are confident that this investment will deliver a strong return on investment for Woolworths Group shareholders,” he concluded.
The transaction is subject to customary closing conditions, including ACCC and NZCC approvals, and is expected to commence mid-next year.
Earlier this week, Woolworths announced the sale of part of its remaining stake in Endeavour Group which would net $636 million, funds that look set to be deployed on the Petspiration acquisition.
