January 26, 2012
VCA Antech buys largest Canadian veterinary chain
Associate Veterinary Clinics operates 44 clinics in three provinces
By: Jim Downing
For The VIN News Service
VCA Antech Inc. has announced that it will complete a CA$71-million purchase of Canada's largest animal hospital business at the end of January. The deal will add 44 clinics run by Associate Veterinary Clinics Ltd. (AVC) to the roughly 540 hospitals VCA already operates.
VCA Chief Financial Officer Tomas Fuller said AVC's hospitals will not be rebranded as VCA clinics, and AVC's management team will remain intact.
"We're going to let them do their own thing," he told the VIN News Service Thursday.
Prior to the AVC purchase, VCA had only one animal hospital in Canada. VCA first invested in AVC in January 2008, buying a 20 percent stake in the chain for CA$6 million as part of an agreement that gave VCA the option to purchase the entire company. In the years since that initial investment, AVC expanded significantly, increasing the value of the remaining 80 percent of the company to CA$71 million. (The Canadian and U.S. dollars are now about equal in value; the same was true in January 2008).
Fuller said VCA plans to provide capital to AVC so that the Canadian chain can continue to acquire hospitals.
AVC employs roughly 200 veterinarians, according to a company representative. The Calgary-based firm has locations in Alberta, British Columbia and Ontario.
Publicly traded VCA operates by far the largest chain of stand-alone veterinary clinics in the United States. (Privately held Banfield Pet Hospital has roughly 800 clinics, nearly all of which are located in PetSmart stores). VCA also runs diagnostics operations — Antech Diagnostics and the imaging company Sound-Elkin — which together do business with more than 60 percent of the nation's roughly 26,000 veterinary clinics.
In July, VCA extended its reach further in the veterinary profession with the acquisition of Vetstreet, an online marketing and client-communication service, as part of a $146 million purchase of MediMedia Animal Health.
VCA reported revenue of $1.38 billion in 2010 and has a market worth of $1.97 billion, based on the value of its stock. The company will announce 2011 earnings on Feb. 16.
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