Veterinary care

Veterinary Care Infographic 1

Market drivers

The global animal health market, which includes commercial animal and companion animal products, is experiencing significant growth driven by increasing demand for commercial animal vaccines (to mitigate the risk of disease in livestock) and a significant increase in pet ownership.

The global pet care market reached sales of c.£81.58bn in 20171 and the animal health market is forecast to grow at a CAGR of 3% until 20202.

Animal pharma is less heavily regulated than the human pharma market and so is attractive to large pharma companies and other investors. Animal health products have a much shorter time to market, meaning there is less pipeline risk for new products compared to human pharma.

Investment thesis

With pet companionship on the rise the market is attractive to both financial investors and strategic buyers which are consolidating the market.

Some players have diversified into areas such as pet crematoriums, online pharmacies, shops, laboratories, out of hours surgeries and vet locum agencies.

Private equity firms are looking to pursue buy and build strategies driving high levels of M&A. For instance, the UK market is dominated by sizeable corporate players including Pets at Home, Independent Vets, CVS and Linnaeus Group.

Evidensia and IVC have created a pan-European platform after merging in 2017. The merger creates a business with around 500 clinics across eight countries.

Trade activity

  • Mars Petcare US Inc (US) acquired Linnaeus Group (UK) and Anicura AB (Sweden) - Linnaeus Group is a specialist veterinary group for small animals. The Linnaeus Group was established following Sovereign’s 2014 platform investment in Willows Veterinary Centre and Referral Service. Since then the group has made many acquisitions, diversified its offering and expanded its geographic reach across England. The Group, which now has over 50 sites, offers a breadth of services including: orthopaedics, ophthalmology, neurology, soft tissue surgery, internal medicine, oncology, dermatology and cardiology. This acquisition further increases the growth of Mars Petcare, which has also recently agreed a deal to acquire major Sweden-based vet care business AniCura AB. These deals together give Mars Petcare a major presence in Europe.
    EV: n.a, EBITDA: n.a
  • VetPartners UK Holdings Ltd (UK) acquired Origin Group (UK) - VetPartners, the UK-based provider of animal care services, acquired the Origin Group which operates in the UK and provides services to a range of animals. It focuses mainly on farm animals such as pigs, poultry and ruminants. VetPartners has itself recently been acquired by BC Partners (see below).
    EV: n.a, EBITDA: n.a

Financial investor activity

  • BC Partners (UK) acquired VetPartners UK Holdings Ltd (UK) - BC Partners, backed by Ares Management, acquired one of the UK’s largest veterinary services providers, VetPartners UK. VetPartners operates through 260 sites, offering small animal, equine and farm animal care services and has completed two acquisitions this year.
    EV: £700m, EBITDA: n.a

Sponsor backed platforms to note:

  • Sponsor: Inflexion
    Company: Medivet
    Country: UK
    Revenue: £88.5m
    EBITDA: £12.2m
    Invested: Feb 2017
  • Sponsor: BC Partners
    Company: VetPartners
    Country: UK
    Revenue: £700m
    EBITDA: n.a.
    Invested: Aug 2018
Veterinary Care Infographic 2
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