D.A. Davidson Advises Allivet, Inc. on Its Pending Sale to Tractor Supply Company

Rhea-AI Summary

Tractor Supply Company (NASDAQ: TSCO) announced the pending acquisition of Allivet, a leading online pet pharmacy founded in 1992. The all-cash transaction is expected to close in Tractor Supply's fiscal first quarter of 2025. Allivet provides prescription and over-the-counter pet medications through its 'PetRx-as-a-Service' platform, partnering with major brands like AKC and Fetch Pet Insurance. The acquisition will enhance Tractor Supply's pet care offerings and provide its 37 million Neighbor's Club members with easier access to pet medications and specialty items.

Positive

• Strategic acquisition expands Tractor Supply's total addressable market in pet care segment
• Adds established PetRx-as-a-Service platform with major brand partnerships
• Provides access to 37 million Neighbor's Club members for medication services
• Allivet brings robust financial profile to the transaction

Negative

• None.

Insights

Financial Analyst

The acquisition of Allivet by Tractor Supply Company represents a strategic move to expand TSCO's pet care offerings and digital capabilities. This all-cash transaction strengthens TSCO's position in the growing pet healthcare market and provides access to Allivet's PetRx-as-a-Service platform. The deal will enhance services for TSCO's 37 million Neighbor's Club members and expand their total addressable market.

The acquisition aligns with TSCO's vertical integration strategy and should drive incremental revenue through cross-selling opportunities and enhanced customer retention. While financial terms weren't disclosed, Allivet's robust financial profile and established partnerships with major players like AKC and Fetch Pet Insurance suggest significant value potential. The deal's expected closure in Q1 2025 indicates a well-structured transaction with manageable regulatory hurdles.

Market Research Analyst

This acquisition positions TSCO strategically in the rapidly growing pet healthcare market, which has shown resilience even during economic downturns. The pet medication sector has been experiencing substantial growth, driven by increased pet ownership and higher spending on pet healthcare. Allivet's established digital infrastructure and pharmacy capabilities give TSCO an immediate competitive advantage against both traditional retailers and online competitors.

The integration of Allivet's e-commerce platform with TSCO's extensive physical retail network creates a powerful omnichannel presence in the pet care segment. This move particularly strengthens TSCO's position against competitors like Chewy and PetMed Express in the online pet pharmacy space, while leveraging their existing customer base for accelerated growth.

IRVINE, Calif.--(BUSINESS WIRE)-- D.A. Davidson announced today that it served as exclusive sell-side financial advisor to Allivet, Inc. (“Allivet” or the “Company”), an online pet pharmacy that sells medications, supplements, and other products for pets, on its pending sale to Tractor Supply Company (NASDAQ: TSCO) (“Tractor Supply”).

D.A. Davidson announced today that it served as exclusive sell-side financial advisor to Allivet, Inc., an online pet pharmacy that sells medications, supplements, and other products for pets, on its pending sale to Tractor Supply Company (Graphic: Business Wire)

Allivet, a portfolio company of Peninsula Capital Partners, is a leading pet pharmacy founded in 1992, and provides quality prescription and over-the-counter pet medications. The Company also provides strategic partnership solutions to customers through retail and e-commerce channels. Allivet’s market pioneering 'PetRx-as-a-Service' platform is growing rapidly with marquee partners such as Tractor Supply, American Kennel Club (AKC), Fetch Pet Insurance, and others. Allivet is a pharmacy at the core, and its mission is to ensure better long-term health outcomes for pets by providing convenient access to pet medications, making compliance easier, and supporting pet owners with expert advice and reliable service.

For more than 85 years, Tractor Supply Company has been passionate about serving the needs of recreational farmers, ranchers, homeowners, gardeners, pet enthusiasts, and all those who enjoy living “Life Out Here”. Tractor Supply is the largest rural lifestyle retailer in the U.S., ranking 293 on the Fortune 500. Its 50,000 team members are known for delivering legendary service and helping customers pursue their passions, whether that means being closer to the land, taking care of animals or living a hands-on, DIY lifestyle. The acquisition of Allivet will complement and strengthen Tractor Supply’s portfolio offering for companion animals, equestrian, and livestock customers and unlock new growth opportunities.

“We are pleased to announce the acquisition of Allivet, a leading online pet pharmacy. This acquisition enhances the benefits we can offer to our 37 million Neighbor’s Club members with an easy and cost-effective solution to obtain medications and specialty items for their pets and livestock. Allivet is a best-in-class platform with an exceptional management team and a robust financial profile. This strategic tuck-in acquisition exemplifies our commitment to delivering value and growth as we expand our total addressable market. We look forward to welcoming the Allivet team to Tractor Supply,” said Hal Lawton, Tractor Supply’s President and CEO.

Ujjwal Dhoot, CEO of Allivet said, “We are excited for Allivet to join forces with Tractor Supply. With Tractor Supply, we can expand our reach and bring the purpose of our product offering and website to millions of customers. As part of Tractor Supply, we will accelerate our growth and innovation to continue to help pets live long healthy lives by making it easier for pet owners to care for them.”

“Allivet and its shareholders have done an excellent job creating a leading ecommerce pet pharmacy, accelerating the industry and enriching the lives of pets and their owners,” stated John Jameson, Managing Director at D.A. Davidson. “We greatly appreciate the opportunity to advise Peninsula Capital Partners on this important transaction and are excited to see what the Allivet team and Tractor Supply are able to accomplish for pet owners.”

“Today’s announced acquisition of Allivet is a watershed moment in Allivet’s long and outstanding history,” said Karl LaPeer, Senior Partner at Peninsula Capital Partners. “We couldn’t be more proud of, and excited for, the Allivet team as they begin their journey as part of America’s iconic rural lifestyle retail brand, Tractor Supply.”

D.A. Davidson served as exclusive financial advisor and Foley & Lardner LLP served as legal advisor to Allivet. Debevoise & Plimpton LLP served as legal advisor to Tractor Supply.

The transaction is subject to customary closing conditions, including receipt of applicable regulatory approvals. The all-cash transaction is expected to close in Tractor Supply’s fiscal first quarter of 2025.

D.A. Davidson’s Consumer Group has a reputation for its depth of industry knowledge, breadth of capabilities, and tenacity of its senior professionals. Offering sector-specific expertise through a full-service platform, the team provides M&A, strategic advisory, and equity capital markets capabilities across several subsectors, including ecommerce & marketplaces; active & outdoor; infant & juvenile; consumer products & services; and food & beverage. Together with its European strategic partner, MCF Corporate Finance, D.A. Davidson originates and executes transatlantic M&A transactions under the brand of D.A. Davidson MCF International.

About D.A. Davidson Companies

D.A. Davidson Companies is an employee-owned financial services firm offering a range of financial services and advice to individuals, corporations, institutions, and municipalities nationwide. Founded in 1935 with corporate headquarters in Great Falls, Montana, and regional headquarters in Denver, Los Angeles, New York, Omaha and Seattle, the company has approximately 1,600 employees and offices in 30 states.

Subsidiaries include: D.A. Davidson & Co., a full-service investment firm providing wealth management, investment banking, equity and fixed income capital markets services, and advice; Davidson Investment Advisors, a professional asset management firm; and D.A. Davidson Trust Company, a trust and wealth management company.

For more information, visit dadavidson.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241024673699/en/

Deal Team Contacts

John Jameson, Managing Director | Indianapolis | jjameson@dadco.com

Steven Orr, Vice President | Irvine | sorr@dadco.com

Paxton Miller, Associate | Irvine | pmiller@dadco.com

Media Contact

Emily Roy

Prosek for D.A. Davidson

(646) 818-9232

eroy@prosek.com

Source: D.A. Davidson Companies

FAQ

When will Tractor Supply (TSCO) complete the Allivet acquisition?

The acquisition is expected to close in Tractor Supply's fiscal first quarter of 2025, subject to customary closing conditions and regulatory approvals.

What type of company is Allivet that Tractor Supply (TSCO) is acquiring?

Allivet is a leading online pet pharmacy founded in 1992 that sells prescription and over-the-counter pet medications, supplements, and other pet products through retail and e-commerce channels.

How will the Allivet acquisition benefit Tractor Supply (TSCO)?

The acquisition will strengthen Tractor Supply's portfolio for companion animals, equestrian, and livestock customers, while providing its 37 million Neighbor's Club members with easier access to pet medications and specialty items.