LONDON (Reuters) - Mars Petcare is to buy European animal hospital operator AniCura, its second such deal this month, as the world’s largest pet food maker expands its veterinary business amid a boom in pet-related spending.
Mars said on Monday it was buying the Swedish company from private investment firms Nordic Capital, Fidelio and other minority shareholders. The deal is worth 1 billion to 2 billion euros ($1.18 billion to $2.36 billion), according to a source familiar with the matter.
Mars did not disclose the price.
The acquisition comes the week after Mars agreed to buy British veterinary services provider Linnaeus Group. It is the latest in a string of petcare deals by Mars and others looking to capitalize on consumers’ increased spending on pets.
Globally, there have been 17 pet-related deals so far this year, according to Poul Weihrauch, president of Mars Petcare, as the trend takes hold around the world, in places including China.
“It’s very hot, if you will, at the moment,” Weihrauch told Reuters. However he described a slow trend over the past several decades that has seen people gradually treat their pets more and more like members of the family, driving higher spending on their nutrition and welfare.
What’s more, petfood and related products sell particularly well online and in cities, he said, meaning that the pet business is benefiting from big trends toward online shopping and urbanization.
AniCura has 200 animal hospitals in Sweden, Norway, Denmark, Germany, Austria, Switzerland and the Netherlands and annual sales of about 4 billion Swedish krona ($459.5 million), according to Peter Dahlberg, its chief executive officer.
Together with Britain’s Linnaeus, Mars is working to build out its veterinary business, which is currently concentrated in North America with brands including VCA, Banfield and BluePearl.
Other recent petcare acquisitions include General Mills’ February deal for pet food maker Blue Buffalo and Nestle (NESN.S) last month taking a stake in Tails.com.
Mars Inc, a privately held American food manufacturer with brands including M&M’s and Twix chocolate, gets about half its annual sales from pet-related goods including Pedigree and Whiskas brands pet food.
Mars was advised on the deal by JP Morgan, while its legal advisors were Freshfields Bruckhaus Deringer and Cederquist.
Reporting by Martinne Geller; Editing by Adrian Croft