Nordic to make 7x on AniCura sale

  • AniCura’s network has grown 4x to 200 clinics under Nordic’s backing
  • Nordic invested in animal health company in 2014 through Fund VIII
  • On the auction block: Harvest- and Cressey- backed VetCor

Nordic Capital’s sale of European veterinary-care company AniCura is poised to produce a 7x return for the buyout shop, a source familiar with the situation said, confirming a Financial Times report.

The buyer is Mars, which is acquiring the business through its veterinary-health arm just days after announcing plans to scoop up another U.K. animal health provider.

Mars Petcare said June 7 it had agreed to buy vet-specialty chain Linnaeus from Sovereign Capital Partners. The latter said the exit represented its largest-ever sale, through which it is poised to generate its strongest-ever gross return.

Mars’s purchase of AniCura values the company at close to €2 billion ($2.36 billion) including debt, the source said, confirming the Financial Times report.

Nordic invested in AniCura through Fund VIII, a €3.5 billion pool of capital. The firm invests in upper-middle-market companies in the Nordic region, as well as elsewhere in Europe and North America.

AniCura’s network of animal hospitals and clinics offers medical services, advanced diagnostics, internal medicine, intensive care, surgery and orthopedics for companion animals. The company also provides rehabilitation, physiotherapy and dietary advice, as well as offers selected pet food and care products.

AniCura was formed in 2011 by Sweden’s Fidelio Capital and Animal Hospital Foundation in the greater Stockholm region. Nordic through its 2014 investment became the majority owner.

Under Nordic’s backing, AniCura has grown fourfold, with its number of clinics expanding to 200 from 50 and its employee count increasing to 4,000 from 1,000, Nordic said in a statement.

The company’s pro forma revenues have grown to about SEK 3.3 billion ($380 million), from SEK 0.9 billion ($100 million), over the corresponding period, the announcement said.

For Mars, the maker of Snickers candy bars, the pair of transactions follow its $9.1 billion bet on veterinary-hospital giant VCA Inc in January 2017.

And while Nordic is exiting the animal-health segment in Europe, the sponsor is said to be among finalists in the sales process for VetCor, the Harvest Partners and Cressey & Co-backed vet-hospital chain spanning 28 U.S. states.

The Jefferies-conducted sales process is expected to produce a transaction valued at more than $1.5 billion, Buyouts reported.

In other recent activity, KKR in December claimed victory for the even larger PetVet, which marked an exit for Ontario Teachers’ Pension Plan and minority investors including L Catterton.

Ares Management in 2014 bought the largest private operator of vet chains, National Veterinary Associates. OMERS Private Equity injected a minority investment in NVA in June 2017.

Mars turned to JP Morgan Securities for financial advice on the AniCura transaction.

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