Story by Debora Lima of South Florida Business Journal
Looks like online pet product retailer Chewy.com isn’t headed for an IPO after all.
Phoenix-based PetSmart Inc. announced Tuesday it struck a deal to acquire the fast-growing Dania Beach, Florida, company. Terms of the transaction were not disclosed. The acquisition is subject to regulatory approval and is expected to close at the end of PetSmart’s second fiscal quarter.
Chewy employs more than 700 people in South Florida alone and more than 4,000 total nationwide. Revenues were projected to explode past the billion-dollar mark this year as the company worked to open three new fulfillment centers during the next 18 months, bringing the company’s number of warehouses to six.
PetSmart has been buying up smaller startups during the past year, including an online pet adoption service and expanded into other areas, such as a dog spa business to battle competition in the various pet sectors. It even had talks about merging with rival Petco, but no merger came to pass. All of this has happened since the company went private in an $8.7 billion deal in 2015.
Founded in 2011, Chewy.com earned a gleaming reputation for offering a variety of perks to its more than 3 million customers. The company was rumored to be going public in 2017.
“Since we started Chewy, we have been dedicated to understanding and satisfying the evolving needs of our customers to deliver the highest quality pet products and customer service,” said Ryan Cohen, co- founder and CEO of Chewy. “Combining our strong e-commerce expertise with PetSmart’s best-in-class infrastructure, footprint and breadth of offerings including services will help us ‘wow’ our customers even more.”
Cohen will stay on as CEO of Chewy, which PetSmart said will operate “largely as an independent subsidiary.”
Lakeland-based firm Allen & Company served as financial advisor to Chewy, while Weil, Gotshal & Manges, based in downtown Miami, acted as legal advisor. Citi and Barclays were PetSmart’s financial advisors on the transaction, with Simpson Thacher & Bartlett acting as the company’s legal advisor.