CD&R to Buy to Radio Systems

Clayton, Dubilier & Rice has agreed to acquire Radio Systems Corporation, a maker and retailer of pet supplies and accessories.

Radio Systems designs and manufactures more than 2,000 pet products under such brand names as Invisible Fence, PetSafe, and SportDOG. The company’s products include pet training and containment systems, food and water dispensers, and bedding for both dogs and cats.

Radio Systems’ products are widely distributed across numerous channels including e-commerce, bricks & mortar retail, and the company’s own direct-to-consumer portal. Radio Systems holds the #1 market position by sales in many of the pet categories it serves. The company, with more than 800 employees, was founded in 1991 by Chairman Randy Boyd and is headquartered in Knoxville, Tennessee.

Post-closing, Mr. Boyd will continue to be active with the company as a member of its board of directors. “With the backing of CD&R and the talented team at Radio Systems, I’m confident the company will continue to deliver the best solutions and services available to its customers,” said Mr. Boyd. “I’m excited for Radio System’s future growth and the success and benefits it will bring to our employees, pet owners, and our local economy.” In March 2020, Mr. Boyd, a 2018 candidate for the governorship of Tennessee, was named the next president of the University of Tennessee. He had been serving as the university’s interim president since November 2018.

“The market for pet care is large and growing with attractive long-term secular tailwinds and demonstrated recession-resilience. We believe Radio Systems’ business model and channels align well with our experience with similarly positioned consumer companies,” said Kenneth Giuriceo, a partner at CD&R. “We look forward to supporting the company’s continued innovation and exciting growth plans.”

At closing, which expected in June 2020, John Compton, a CD&R operating partner, will become the chairman of Radio System’s board of directors. Mr. Compton is the former president of PepsiCo and serves as chairman of three other CD&R portfolio companies including American Greetings, Drive DeVilbiss Healthcare, and TruGreen.

“Radio Systems is a differentiated market leader with a talented management team, dedicated, hard-working employees, a product portfolio that pet owners truly value, and a three-decade track record of product-driven innovation and strong overall results,” said Mr. Compton. “We believe Radio Systems is a great fit with CD&R’s experience helping businesses prosper over the long term.”

New York and London-based CD&R invests in European and US-based businesses. Since founding in 1978, the firm has invested $30 billion in 90 companies across a range of industries including numerous consumer health and medical device businesses.

UBS Investment Bank, BMO Capital Markets, BNP Paribas Securities, and Fifth Third are serving as financial advisors to CD&R.

Private Equity Professional | May 13, 2020

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