Idaho-based pet medication firm closes $185 million acquisition

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EAGLE — A local company is aiming to take a larger bite out of the rapidly growing U.S. pet medication sales market.

PetIQ on July 8 finalized its acquisition of Perrigo’s animal health unit for $185 million in cash. Now a wholly owned subsidiary, Perrigo’s brands will complement PetIQ’s own suite of products, according to a company official.

Founded in 2010, PetIQ’s brands include pet prescription medicine, over-the-counter treatments, pet supplies and treats. Originally called True Science, the company changed its name in 2016.

“We are excited to have closed this important acquisition, and we welcome the Perrigo Animal Health team to PetIQ,” said Cord Christensen, the company’s chairman and CEO, who first announced the deal in May. “We look forward to capitalizing on our opportunities to increase our manufacturing scale, expand product and brand diversity, and improve customer reach, all while we capture significant cost savings and synergies to fuel greater net sales and profitability.”

The deal comes as Perrigo, which is headquartered in Dublin, Ireland, but run from Allegan, Michigan, moves away from its animal health line to a more consumer-focused company. Perrigo’s pet health and wellness sales totaled $93.9 million in 2018, down from $141.3 million in 2017. The division includes the PetArmor, Sentry and Sergeants brands.

PetIQ reported $528.6 million in 2018 revenue.

In other developments, PetIQ also announced that Michael Smith, a pet and consumer packaged goods industry veteran formerly with Walmart, has been hired as the company’s new executive vice president of the products division.

“We are also very pleased to announce that Michael has joined us from the world’s largest retailer where he has held various leadership roles within the pet and personal care categories. We look forward to Michael’s leadership contributions as we integrate Perrigo Animal Health and grow our existing pet products business over the next several years,” Christensen said.

According to an SEC filing prior to the Perrigo acquisition, PetIQ had 1,452 employees, the majority of them working at its factories in Utah, Texas and Florida, and pet clinics inside Walmart stores. Its corporate headquarters, at 923 S. Bridgeway Place in Eagle, employs about 40 people.

Publicly traded on the NASDAQ exchange, PetIQ is just the eighth Idaho company whose shares now trade on a major stock exchange.

The company distributes its products across a network of national retail stores in mass merchandisers, club, grocery, pharmacy and e-commerce channels.

More than half of all households in the U.S. own a dog or cat, and they are spending more and more on their animals. Overall, the  U.S. pet medication sales market has grown at 4% a year, according to one consumer goods research firm. Sales of pet medications are estimated to reach $8.9 billion in 2019, according to Packaged Facts, a consumer-goods market research firm.