It appears this was the right tree to bark up.

Investors are certainly howling with joy after animal hospital chain VCA Inc. – Nasdaq ticker “WOOF” – announced that it accepted a $9.1 billion buyout offer from Mars Inc. last week. The candy conglomerate paid $93 a share for VCA and took on $1.4 billion of VCA’s existing debt in addition to $7.7 billion in cash it shelled out for the veterinary and laboratory diagnostic company.

The deal represents a huge premium for shareholders, which include VCA’s trio of co-founders: brothers Robert and Art Antin and their friend and business partner Neil Tauber, who formed the company in 1986. All three are still executives at VCA – Bob Antin, 65, serves as chairman and chief executive; Art Antin, 69, is chief financial officer; and Tauber, 65, serves as head of development – and will continue to run the company as an independent unit of Mars going forward. Together, they own about 4 percent of the company’s stock.

The three co-founders, who through a spokesman declined to comment, said in a letter to their employees that while they were not actively looking to sell the company, Mars’ offer was one that couldn’t be refused.

“After thorough deliberations, we determined that this is a unique opportunity for all of the company’s stakeholders, especially our employees,” the letter reads. “Through our continued conversations with the Mars team, we became confident that our two organizations share a common vision.”

West L.A.-based VCA has the largest network of veterinarians and diagnostic clinics in the United States and Canada, with more than 23,000 employees, including 1,400 in Los Angeles, according to a company spokesman. VCA had revenue of $2.1 billion in 2015 and said in its most recent quarterly earnings report that it was on pace to beat that last year.

On its surface, the deal seems odd – Mars is best known for M&M candies and Snickers bars – but the McLean, Va.-based company also owns pet brands such as Whiskas and Pedigree. Adding VCA to this side of its business is a coup for the company, according to a statement from Mars Chief Executive Grant Reid.

“VCA is a leader across pet health care and the opportunity we see together – for pets, pet owners, veterinarians, and other pet care providers – is tremendous,” Reid said. “Together, we will be able to provide even greater value, better service, and higher-quality care to pets and pet owners.”

The deal marks the end of 30 years of independence for VCA, which bought its first veterinary clinic – the West Los Angeles Veterinary Medical Group – in 1987. The company went on to scoop up more than 700 animal hospitals in the United States and an additional 80-plus in Canada by the time of the deal.

For reprint and licensing requests for this article, CLICK HERE.