Following its acquisition by PetSmart approximately two years ago, Chewy.com filed papers to gear up for an initial public offering (IPO).
The eCommerce pet supply merchant took in sales for fiscal 2018 of $3.5 billion, which marked an increase from 2017 at $2.1 billion, CNBC reported.
The company is said to list under the symbol of “CHWY” and has tapped Morgan Stanley, J.P. Morgan and Allen & Co. to assist in the IPO. After the offering, PetSmart will reportedly stay as Chewy’s majority owner. It was also reported that the company would use the IPO’s proceeds for general corporate purposes along with working capital. While Chewy didn’t say how much it plans to bring in through the offering, estimates in the past have put the valuation in the range of $4.15 billion to $4.75 billion.
Michael Day and Ryan Cohen started Chewy in 2011, and the firm has set itself apart from rivals with features such as two-day shipping of eCommerce purchases. PetSmart acquired the company in 2017 for approximately $3 billion to bring in an eCommerce effort to pair with its store base. After its acquisition by PetSmart, the company rolled out an online pet pharmacy called “Chewy Pharmacy” and has grown its private label.
The news comes as it was recently reported that U.S. shoppers spend roughly $70 billion on pet food, vet care and supplies, among other services. By comparison, they spent only approximately $40 billion 10 years ago.
The market, too, has brought the attention of Amazon. That eCommerce retailer is garnering a larger share of the overall retail spending of consumers as documented by PYMNTS research.
According to a recent Wall Street Journal report, Amazon “has an advantage because it can bundle a range of products in the same shipment to offset the high cost of shipping heavy bags of dog food or cat litter.” The company reportedly brought in $3.3 billion in pet product sales in 2018 per Packaged Facts’ estimates.