PetSmart acquires fast-growing online rival
PetSmart is beefing up its digital offerings with the acquisition of the leading online retailer of pet food and products. And the retailer reportedly is paying handsomely for it.
PetSmart has entered into an agreement to acquire Chewy, which offers a wide selection of products and food for pets, ranging from cats and dogs to horses. The price was not disclosed by the two privately-held companies, but Recode put the deal at a whopping $3.35 billion. If Recode is correct in the amount, it would be the biggest e-commerce acquisition to date, slightly exceeding Walmart’s acquisition of jet.com last year.
Founded in 2011, Chewy is based in Dania, Florida. The company had been on a steep upward trajectory. Sales reportedly totaled $900 million in 2016, and the retailer had said it expected to increase revenue to $1.5 billion this year.
The acquisition is expected to close by the end of PetSmart’s second fiscal quarter of 2017.
“We are focused on improving our customers’ experience in-store and online as we continue to execute against our long-term strategic initiatives,” said Michael Massey, president and CEO of PetSmart, which operates some 1,524 stores nationwide. “Chewy’s high-touch customer e-commerce service model and culture centered around a love of pets is the ideal complement to PetSmart’s store footprint and diverse offerings.”
After the deal is closed, Chewy will continue to be led by CEO Ryan Cohen and operate largely as an independent subsidiary of PetSmart, focusing on its current business strategy, while PetSmart will continue to execute its strategic initiatives across the combined company. Both companies will use their shared innovative capabilities and offerings in order to deliver the most value and convenience to customers, PetSmart said.
PetSmart rival Petco is also expanding its online capabilities. On April 4, the company acquired digital pet services company PetCoach, a pet advice website and app that helps pet owners take better care of their pets, connecting them with veterinarians for personalized answers to their questions.
Cabela’s revises deal with Bass Pro
Bass Pro Shops has lowered its bid for Cabela’s.
Under the amended merger agreement, Bass Pro will acquire Cabela’s for $61.50 per share in cash for a total deal value of approximately $5.0 bil-lion. On October 3, 2016, Bass Pro has agreed to pay $65.50 per share in cash for Cabela’s in a deal valued at $5.5 billion.
“We’re excited to announce this agreement, which allows us to look ahead with greater certainty toward the completion of our merger with Bass Pro Shops and offers a positive step forward for all parties,” said Tommy Millner, CEO, Cabela’s.
The merger remains subject to approval by Cabela’s shareholders, as well as antitrust clearance and other customary closing conditions
Cabela’s also said in a it has entered into an agreement with Synovus Fi-nancial Corp., Columbus, Georgia, to take over $1.2 billion in assets of its World's Foremost Bank subsidiary. Following completion of the deal, Cabela's will sell its credit card assets to Capital One, which will continue to operate the Cabela's Club credit card program and the card servicing center in Lincoln.
The sale of the bank must be approved by regulators.
Citibank exec joins Walmart’s digital team
Walmart has appointed Rahul Joshi as senior VP, customer care, U.S. eCommerce, effective immediately.
Joshi joins the discounter after more than 25 years at Citibank, most re-cently as the head of consumer operations in Asia, where he successfully led customer-focused teams. He reports to Marc Lore, president & CEO, Walmart U.S. eCommerce.
“His experience, and the fact that Rahul will sit on my leadership team, will ensure that the voice of the customer is represented stronger than ev-er before,” said Lore.
In addition to leading the customer care operation at walmart.com and jet.com and enhancing the overall customer experience. Joshi will oversee the returns experience and fraud teams.