Sentinel Closes Sale of Pet Supplies Plus

Sentinel Capital Partners has closed its sale of Pet Supplies Plus to Franchise Group for $700 million. Sentinel and Franchise Group agreed to the terms of this transaction in January 2021.

Sentinel acquired Pet Supplies Plus, the third-largest pet specialty chain in the US, from Irving Place Capital in December 2018.

Pet Supplies Plus (PSP) is a franchisor and operator of pet-specialty stores. The company’s system spans 36 states and is currently comprised of more than 562 stores with 60% franchised and 40% company-owned locations.

PSP founders, Harry Shallop and Jack Berry, opened their first store in Redford, Michigan in 1988. Today the company is headquartered near Detroit in Livonia, Michigan. For fiscal year 2020, PSP is estimating total systemwide revenue of approximately $1.2 billion, company revenue of over $825 million and adjusted EBITDA of nearly $80 million.

Franchise Group (NASDAQ: FRG) is an operator and acquirer of franchisable businesses. The company has four segments: Liberty Tax, a provider of online and in-person tax preparation services in the United States and Canada (2,500 locations); Buddy’s, a rent-to-own specialty retailer of electronics, furniture, and appliances (300 locations); American Freight, a discount retailer of home appliances, furniture and mattresses (300 stores); and The Vitamin Shoppe, an omnichannel specialty retailer and wellness company (750 company-operated stores).

Franchise Group, led by CEO Brian Kahn, changed its name in September 2019 from Liberty Tax, Inc., and is headquartered in Virginia Beach, Virginia.

To review Franchise Group’s investor presentation on its acquisition of PSP (embedded in its January 25, 2021 8-K) click HERE.

New York City-based Sentinel Capital invests in management buyouts, recapitalizations, corporate divestitures, and going-private transactions of businesses with EBITDAs up to $80 million. Sentinel targets eight industry sectors: aerospace and defense, business services, consumer, distribution, food and restaurants, franchising, healthcare, and industrials.

© 2021 Private Equity Professional | March 12, 2021

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