Petco prices IPO above target range to raise US$816 million

Petco prices IPO above target range to raise US$816 million

Pet retailer Petco Health and Wellness Company Inc said on Wednesday it sold shares in its initial public offering (IPO) at US$18 apiece, above its target range, to raise about US$816.5 million.

FILE PHOTO: A Petco store logo is pictured on a building in North Miami, Florida
FILE PHOTO: A Petco store logo is pictured on a building in North Miami, Florida March 19, 2016. REUTERS/Carlo Allegri

REUTERS: Pet retailer Petco Health and Wellness Company Inc said on Wednesday it sold shares in its initial public offering (IPO) at US$18 apiece, above its target range, to raise about US$816.5 million.

Petco, which is owned by the Canada Pension Plan Investment Board (CPP Investments) and private equity firm CVC Capital Partners, had aimed to sell 48 million shares at a target range of US$14 to US$17 per share.

The IPO, which values Petco at almost US$4 billion, signals that investor appetite for new stocks remains robust following a stellar 2020, which was the strongest IPO market in two decades.

Earlier in the day, shares of online lender Affirm Holdings Inc doubled in their Nasdaq debut after selling shares in its IPO above the company's target range.

The U.S. pet industry is seen by analysts as being more resistant to economic shocks than the broader economy and has benefited during the COVID-19 pandemic from an increase in pet adoption.

Rival online pet products retailer Chewy Inc has seen its stock rise more than 100per cent in the last six months. Barkbox, a provider of subscription boxes of dog treats, last month agreed to go public through a merger with Northern Star Acquisition Corp.

San Diego, California-based Petco operates about 1,470 stores across the United States and Puerto Rico and has more than 100 in-store veterinary hospitals.

Founded in 1965, Petco was acquired CPP Investments and CVC Capital Partners in 2015 for about US$4.7 billion. Petco reported net sales of US$3.6 billion and net loss of US$20.3 million in the 39 weeks ended Oct. 31 last year.

Petco shares are due to begin trading on the Nasdaq on Thursday under the symbol "WOOF."

Goldman Sachs, and BofA Securities are the lead underwriters for the IPO.

(Reporting by Joshua Franklin in Miami and Chibuike Oguh in New York. Additional reporting by Anirudh Saligrama in Bengaluru, Editing by Chris Reese, Aurora Ellis and Sherry Jacob-Phillips)

Source: Reuters

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