VCA Antech Inc. on Tuesday said that it had signed an agreement to acquire a publically held competitor, PET DRx Corp., in a deal valued at more than $41 million.
PET DRx, based in Brentwood, Tenn., operates 23 animal hospitals with annual revenue of about $64 million, said Los Angeles-based VCA Antech, which operates animal hospitals and labs in 40 states.
Though a two-stage purchase of shares, VCA Antech will acquire PET DRx for $41.3 million, of which $28.5 million will be used to pay down debt. After the payment of debt and other adjustments, the company expects the purchase price to be equal about 34 to 36 cents per common share.
Stockholders holding a majority of the outstanding shares of PET DRx have executed a written consent approving the transaction, the company said, so no shareholder vote will be necessary.
On completion of the merger, VCA Antech will operate more than 520 animal hospitals. PET DRx now operates several hospitals in California.
“The combination will allow the hospitals to share valuable medical and management capabilities with a continuing focus on delivering the highest quality of veterinary care,” said Chief Executive Bob Antin in a statement. “We are excited about the opportunities to explore and expand our teaching programs and the outreach that the combination of these hospitals provides.”
Shares were up 25 cents, or 1 percent, to $25.67 in midday trading on the Nasdaq.
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