A PYMNTS Company

US: Mars to buy pet hospital chain for $7.7 Bn

 |  January 9, 2017

The company name Mars evokes images of M&M’s, Snickers and Dove chocolate, and possibly Wrigley chewing gum.

Soon, a majority of its business will be related to pets, thanks to a $7.7 billion acquisition announced Monday.

Mars agreed to buy VCA, a company that owns about 800 animal hospitals, a lab business and dog day care franchises that operate under the name Camp Bow Wow. VCA will be part of Mars Petcare but will operate as a “distinct and separate business unit,” the companies said in a statement on Monday.

Poul Weihrauch, the president of Mars Petcare, said in an interview that Mars’ “love story” with pets goes back to 1935. That year, Forrest Mars Sr. bought Chappell Brothers, giving the candy company access to Chappie brand canned dog food. Mars increased its pet offerings in the 1990s, introducing brands like Pedigree and Whiskas.

Today, Mars has 39 brands in its Petcare portfolio, its second largest division. With this deal, Petcare will become its largest business, as VCA adds about $2 billion in revenue. Together, Petcare, chocolate and Wrigley contribute 90 percent of company sales.

The impetus for the acquisition goes back years. Mars, based in McLean, uses VCA’s lab services in its veterinary businesses. Talks about a deal began when Mars approached VCA in November. VCA, based in Los Angeles, had been an independent company for more than 30 years, and Bob Antin, the chief executive, said it was not looking to sell.

Full Content: New York Times

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