Petco Acquired Drs Foster and Smith

marquiseo · Nov 20, 2014

Direct link: http://finance.yahoo.com/news/petco-acquire-online-pet-product-205500547.html">http://finance.yahoo.com/news/petco-acquire-online-pet-product-205500547.html</a>

SAN DIEGO, Nov 19, 2014 /PRNewswire/ -- Petco today announced it has entered into an agreement to acquire Drs. Foster and Smith, a leading veterinary-owned online pet supply company. This combination will unite one of the largest pet specialty retailers with one of the largest online pet retailers in the country.

Petco
Based in Rhinelander, Wisconsin, Drs. Foster and Smith are among the nation's foremost authorities on pet care and education, with a strong reputation for their scope of veterinary expertise on prescription medications and quality products for dogs, cats, fish, birds, reptiles, horses, pond life and small animals.

"This move underscores our commitment to nurturing the complete health and well-being of animals and further allows Petco to meet the diverse and expansive needs of pet parents," said Jim Myers, Petco CEO. "As pet lovers first and foremost, our values are perfectly aligned with Drs. Foster and Smith, and we're confident this new addition to our business will help us continue to offer the very best in products and services to pets and pet parents."

Petco provides customers with high-quality pet food, supplies and services, driven by the understanding that pet health goes beyond basic needs to include support of the physical, mental, social and emotional needs of pets. The acquisition will complement Petco's existing capabilities in pet health to include prescription services, including prescription diets, preventive care and a broad base of products created by licensed veterinarians.

Drs. Foster and Smith was founded in 1983 as a group of four veterinary clinics with the goal of helping pets live healthier, happier lives by providing the highest quality veterinary care available. Dr. Race Foster, Dr. Rory Foster and Dr. Marty Smith's Animal hospitals in Northern Wisconsin were the first in the nation to offer free rabies vaccinations and free spay/neutering services.

Since its beginnings, Drs. Foster and Smith has developed a sterling reputation on the strengths of its top-level customer service, consumer education and competitive pricing, evidenced by tremendous customer loyalty and satisfaction. In 2003, the company began offering a full-service pharmacy that enables customers to fill prescriptions online and by mail-order. The acquisition includes both Drs. Foster & Smith's prescription services as well as its popular branded products, including joint care supplements, dog and cat foods, dog beds, cat furniture, horse supplies, equine equipment and other pet care essentials.

"At our founding, our intent with Drs. Foster and Smith was to provide pet owners with veterinary advice and quality pet supplies at affordable prices," said Race Foster, DVM, and Co-Founder of Drs. Foster and Smith. "We believe Petco shares those same values, and we look forward to building on our original mission."

The acquisition, in which Drs. Foster and Smith are exclusively represented by Falls River Group, is expected to be completed by early 2015 and is subject to customary closing conditions, including receipt of regulatory approvals. The terms of the deal are not being disclosed.

For more information about Petco or to find a location near you, visit petco.com.

About Petco and the Petco Foundation
Petco is a leading pet specialty retailer that focuses on nurturing powerful relationships between people and pets. We do this by providing the products, services, advice and experiences that keep pets physically fit, mentally alert, socially engaged and emotionally happy. Everything we do is guided by our vision for Healthier Pets. Happier People. Better World. We operate more than 1,300 Petco locations across the U.S., Mexico and Puerto Rico, including more than 100 Unleashed by Petco locations, a smaller format neighborhood shop; 10 Pooch Hotel destinations for pet daycare, boarding and spa services; and petco.com. The Petco Foundation, an independent nonprofit organization, has raised more than $125 million since it was created in 1999 to help promote and improve the welfare of companion animals. In conjunction with the Foundation, we work with and support thousands of local animal welfare groups across the country and, through in-store adoption events, help find homes for more than 400,000 animals every year.

bcrueter · Nov 20, 2014

We'll this can go 1 of 2 ways... Petco will get better in the fist dept. or dr foster and smith( live aquaria) will go to crap

dawgface · Nov 20, 2014

bcrueter;997387 wrote: We'll this can go 1 of 2 ways... Petco will get better in the fist dept. or dr foster and smith( live aquaria) will go to crap

The latter most assuredly :boo:

marquiseo · Nov 20, 2014

I think it will be a good thing. Here is what I believe will happen:

-Most of the products offered by Drs Foster and Smith may be offered in stores now.
-Revamping of saltwater department. Stricter requirements because of knowledge from Drs foster and smith
-Cheaper in-store prices for petco products.
-increased varieties of corals and fish offered at petco stores

My thinking behind this is that Drs foster and smith is well respected and will not let a pet store giant just ruin its business relationships and good name. The article stated that it was an agreement so terms have to have been met to finalized the acquirement.

redstang · Nov 20, 2014

Dang. Hopefully Diver's Den stays top quality. I just don't see this being good for hobbyists. All I can say is that the Lord we have some good local fish stores that consistently deliver quality livestock.

redstang · Nov 20, 2014

MarquiseO;997393 wrote: I think it will be a good thing. Here is what I believe will happen:

-Most of the products offered by Drs Foster and Smith may be offered in stores now.
-Revamping of saltwater department. Stricter requirements because of knowledge from Drs foster and smith
-Cheaper in-store prices for petco products.
-increased varieties of corals and fish offered at petco stores

My thinking behind this is that Drs foster and smith is well respected and will not let a pet store giant just ruin its business relationships and good name. The article stated that it was an agreement so terms have to have been met to finalized the acquirement.

Props for positive thinking. I see it more as Petco exploiting the Drs Foster and Smith name for money, not to increase their quality.

bcrueter · Nov 20, 2014

Yea I remember when my company was acquired and absorbed... There was to be more resources and money to fix our company. But we got squeezed dry they torn apart. Petco will not up there salt water requirements because they make money the way they do it and will not invest for less profit. Now your right there may be more equipment and supers for salt water in petco. But they still will not be getting my hard earned money.

stacy22 · Nov 20, 2014

:rocketwhore:This cannot be good.

marquiseo · Nov 20, 2014

RedStang;997395 wrote: Props for positive thinking. I see it more as Petco exploiting the Drs Foster and Smith name for money, not to increase their quality.

Most people are only seeing this as one-sided based on experience at certain petco stores. I, honestly, do not believe that Drs Foster and Smith would be in an agreement under Petco without changes. I, also, believe that Petco pursued Drs Foster and Smith to improve its organization. Companies merge only when one is failing(going bankrupt for example) or if a merger benefits both companies endgame. Money does play a role but Drs Foster and Smith wasn't losing sales like Petco. The article would have stated Drs Foster and Smith to acquire Petco if money was the motive.

redstang · Nov 20, 2014

MarquiseO;997401 wrote: Most people are only seeing this as one-sided based on experience at certain petco stores. I, honestly, do not believe that Drs Foster and Smith would be in an agreement under Petco without changes. I, also, believe that Petco pursued Drs Foster and Smith to improve its organization. Companies merge only when one is failing(going bankrupt for example) or if a merger benefits both companies endgame. Money does play a role but Drs Foster and Smith wasn't losing sales like Petco. The article would have stated Drs Foster and Smith to acquire Petco if money was the motive.

The problem is that Petco has been the laughing stock of the salt water hobby for a very long time. Too many employees have posted that they've tried to make positive changes only to have them shot down by corporate policy.

This is only my opinion but my feeling is Petco is about profit only and at any expense. Being a capitalist I don't have a problem with that to a certain extent. However, I also consider myself a conservationist and the waste in life that trails behind Petco is ridiculous.

If we're lucky, it means Petco is dropping in store salt water fish sales and will instead use LA as their online outlet. I just don't see the culture at Petco changing. And I'm generally an optimist.

dawgface · Nov 20, 2014

MarquiseO;997401 wrote: Most people are only seeing this as one-sided based on experience at certain petco stores. I, honestly, do not believe that Drs Foster and Smith would be in an agreement under Petco without changes. I, also, believe that Petco pursued Drs Foster and Smith to improve its organization. Companies merge only when one is failing(going bankrupt for example) or if a merger benefits both companies endgame. Money does play a role but Drs Foster and Smith wasn't losing sales like Petco. The article would have stated Drs Foster and Smith to acquire Petco if money was the motive.

Petco is not in competition with companies of the likes of our beloved LFS. They are in direct competition with places like Target,Walmart and of course petsmart. With their mammoth of a organization (think over 1,000 store front locations) they are looking to bolster their online presence and edge here, that is all. Not sure where this agreement your referring to comes from as this is an acquisition of one company to another. Any agreements were for purposes of that acquisition. The name and it's entirety now belongs at the hands (or soon will) to another.

dawgface · Nov 20, 2014

Where also have you read that Petco is failing by the way? I've read of no such market news for them.

tonymission · Nov 20, 2014

MarquiseO;997401 wrote: Most people are only seeing this as one-sided based on experience at certain petco stores. I, honestly, do not believe that Drs Foster and Smith would be in an agreement under Petco without changes. I, also, believe that Petco pursued Drs Foster and Smith to improve its organization. Companies merge only when one is failing(going bankrupt for example) or if a merger benefits both companies endgame. Money does play a role but Drs Foster and Smith wasn't losing sales like Petco. The article would have stated Drs Foster and Smith to acquire Petco if money was the motive.

They aren't joining up to form a partnership. Petco is acquiring this company for a huge lump of cash and/or stock and has the leverage in that situation. Founders want cash; I bought a chunk of a large profitable company and everyone wondered how/why-- owner is already rich, why would he do that? Rich people like 7,8 and 9 figure checks regardless of how much they already have. Especially when they get older.

The buyer wants the purchased company's assets, online infrastructure, customer base, facilities etc. Or it's a direct competitor and they just want to dissolve then. No one is buying a failing company unless they want one of their specific products/IP and a failing company isn't buying anything. Again, this isn't considered a merger.

As someone else stated, you have a real positive outlook here and that's admirable, but I'd be surprised if that holds true years from now.

marquiseo · Nov 20, 2014

DawgFace;997409 wrote: Where also have you read that Petco is failing by the way? I've read of no such market news for them.

No one said that they were failing. I was giving the reasons for most mergers. The article states acquire. Acquisition can be done without complete ownership. Wording in the article is very specific. What is released to the public came from the representative of the companies.

But this data

dawgface · Nov 20, 2014

MarquiseO;997413 wrote: No one said that they were failing. I was giving the reasons for most mergers. The article states acquire. Acquisition can be done without complete ownership. Wording in the article is very specific. What is released to the public came from the representative of the companies.

But this data http://www.nasdaq.com/markets/ipos/company/petco-animal-supplies-inc-9730-16041?tab=financials">here</a> does show insight that petco was going through hard times. I don't know how recent it is but it does give some numbers.[/QUOTE]

2001-02 filings, everyone was on hard times then... Atleast in America.

But in any event, I've never heard of a public company partial purchasing a private competitor. But let's say that happened, in either event it's clear what Petco is after in both transactions.... That is not a more diverse, more expensive write off e.g. Rare and LE fish and coral. It is as the article identifies [QUOTE=]Veterinary-owned brand will expand [B]Petco's online offering[/B] to [B]include prescription services[/B] and additional pet products[/QUOTE]

But in any event well see soon I suppose.

dawgface · Nov 20, 2014

Petco Acquired Drs Foster and Smith

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