SilverCape Investments announced it has released an open letter to the board of directors of PetMed Express calling on the company to engage on a revised proposal to acquire all outstanding shares of PetMed for $3 per share in cash.
The proposed purchase price represents a premium of about 70% to PetMed’s closing share price of $1.76 on June 26, 2026. SilverCape said the proposal has no financing contingency.
SilverCape, a Singapore-based single-family office, said it owns about 12% of PetMed’s outstanding common stock. The firm said it believes PetMed is no longer viable as a public company following its recent quarterly and fiscal year report, and it urged the board to pursue a sale before the remaining value of the company is further eroded.
The revised proposal follows SilverCape’s previous offer, made on December 11, 2025, to acquire PetMed for $4 per share in cash with no financing contingency. SilverCape said PetMed’s financial condition and business prospects have continued deteriorating since the original proposal was made.
In the letter, SilverCape criticized PetMed’s board for what it described as a failure to meaningfully engage with its prior proposal or run a bona fide sale process. SilverCape also noted that PetMed previously disclosed that it had evaluated two acquisition proposals ranging from $4 to $4.25 per share and instructed financial advisors to solicit interest from strategic and financial sponsors, but ultimately determined not to proceed with either publicly announced proposal.
SilverCape said it believes the company’s disclosure about that process was misleading because, in its view, PetMed did not run a marketed sale process and did not meaningfully engage with SilverCape or provide feedback on how the prior proposal could be improved.
SilverCape also highlighted what it described as a significant deterioration in PetMed’s business. The firm cited shrinking prescription medication revenue, declining repeat-customer revenue, higher customer acquisition costs, gross margin pressure, and rising general, administrative, and remediation costs.
The letter also pointed to PetMed’s cash position, which SilverCape said declined from $54.7 million to $21.4 million in the last fiscal year. SilverCape also referenced PetMed’s latest 10-K, which included language that its financial condition “may currently and in the future raise substantial doubt” about its ability to continue as a going concern.
SilverCape further criticized what it described as leadership instability and governance failures at PetMed. The firm said PetMed has experienced the departure of two CEOs and CFOs over the past two years, with board chair Leslie C.G. Campbell currently serving as interim CEO. SilverCape also criticized Campbell’s annual base salary of $1.3 million given PetMed’s sub-$40 million market capitalization.
SilverCape claimed PetMed’s board and management team are not sufficiently aligned with stockholders, citing the company’s last proxy statement showing that board members and executive officers owned about 2% of outstanding shares, or below 1% when shares held by the former CEO are excluded.
SilverCape also criticized PetMed’s corporate governance structure, including bylaw provisions that it says make it difficult for stockholders to nominate alternative directors, the timing of the company’s 2026 annual meeting, and the repeated renewal of the company’s Stockholder Rights Plan without stockholder approval.
The firm said its revised $3 per share proposal would provide stockholders with immediate liquidity and preserve value at a time when PetMed faces continued business risk. SilverCape also said it would support other third-party alternatives that offer stockholders superior value and called on PetMed to run a structured and independent process if it does not engage with SilverCape.
PetMed Express, based in Delray Beach, Florida, is an online pet pharmacy and pet health company. SilverCape is a Singapore-based single-family office with a long-term investment approach.
KEY QUOTES:
“Based upon the dismal quarterly and fiscal year report of PetMed earlier this month, it is no longer viable as a public company and should seek a sale to an interested buyer before the remaining value of the Company is eroded and destroyed.”
“Since we made our original proposal, PetMed’s financial condition has continued to deteriorate, and the Board has failed to provide stockholders with a credible plan that could reverse the Company’s decline.”
“While still at a significant premium to the market price of the stock, the revised purchase price reflects the Company’s continued deterioration. We urge the Board to act before the remaining value of the Company is eroded and destroyed.”
“To be clear, as a significant stockholder of the Company, SilverCape has advanced a solution that it believes is in the best interests of all stockholders. We also welcome other third-party alternatives that offer stockholders superior value and would be supportive of PetMed running a structured and independent process to consider those alternatives. However, the Board must act with alacrity to surface a solution before it is too late.”
Peter Kennedy, Managing Director of SilverCape Investments
