Why Clayton Dubilier & Rice And TPG Are Buying Covetrus (CVET) In A $4 Billion Deal

By Amit Chowdhry ● May 25, 2022
  • Clayton, Dubilier & Rice (CD&R) and TPG announced a deal to buy Covetrus for about $4 billion. This is why.

Covetrus (NASDAQ: CVET), a global leader in animal health technology and services, announced that it has entered into a definitive agreement pursuant to which funds affiliated with Clayton, Dubilier & Rice (CD&R) and TPG Capital will acquire all outstanding shares of Covetrus common stock not already owned by affiliates of CD&R for $21.00 per share in cash, representing an enterprise value of approximately $4 billion.

CD&R and its affiliates currently beneficially own approximately 24% of Covetrus’ outstanding shares of common stock. The deal delivers significant value to Covetrus’ shareholders and represents a 39% premium to Covetrus’ 30-day volume-weighted average price per share as of the unaffected stock price as of May 13, 2022.

The proposed transaction has been unanimously approved by a transaction committee of independent directors of the Board of Directors of Covetrus (the transaction committee). And the Board of Directors of Covetrus has unanimously approved the proposed transaction on the recommendation of the transaction committee.

The deal is expected to close in the second half of 2022. completion of the transaction is subject to certain regulatory approvals and the satisfaction of other customary closing conditions, including the approval of Covetrus’ shareholders. And the deal will be financed through a combination of cash funded by investment funds affiliated with CD&R and TPG Capital, as well as committed debt financing.

Upon completion of the deal, Covetrus will become a private company and will no longer be publicly listed or traded on NASDAQ. Covetrus’ management team, including Benjamin Wolin, President and Chief Executive Officer, is expected to continue to lead the company. Covetrus plans to maintain its headquarters in Portland, Maine, and will continue to operate under its current brands.


“This transaction is an important milestone for our company, shareholders, employees, customers and partners. Not only does this deal provide compelling value for our existing shareholders, it allows Covetrus to continue its mission to drive positive outcomes – both business and healthcare – for veterinarians across the globe. We appreciate CD&R’s support and their continued commitment to our company and the global veterinary community.”

— Benjamin Wolin, Covetrus’ President and Chief Executive Officer and a member of its Board of Directors

“Covetrus has undergone a true transformation since our initial 2015 investment in its predecessor Vets First Choice, growing from $55 million in revenue focused primarily on online pharmacy in the US to a leading global provider of animal health services with more than $4.6 billion in revenue.”

— Sarah Kim, Partner at CD&R

“We are excited to have this opportunity to grow our investment in Covetrus and to do so in partnership with TPG and management.”

— Ravi Sachdev, Partner at CD&R

“Covetrus offers a dynamic portfolio of leading distribution and technology solutions to veterinarians across the globe.”

— Jeff Rhodes, Co-Managing Partner at TPG Capital

“The company is at an important stage in its ongoing evolution, and we look forward to partnering with management and CD&R to further its leadership in the growing animal health space.”

— Kendall Garrison, Partner at TPG Capital