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Swedencare Acquires Vetio Animal Health Group for $181M

Glenn Polyn//June 30, 2021//

Swedencare Acquires Vetio Animal Health Group for $181M

Glenn Polyn //June 30, 2021//

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Press release: Swedencare

Swedencare AB has announced it is acquiring the U.S.-based Vetio (formerly Tropichem) with the purchase price coming to $181.5 million, consisting of a cash amount of $179 million (approximately SEK 1 524 million) and an issue in kind of 184 190 shares in Swedencare, representing $2.3 million USD (approximately SEK 19 million), to the selling management at closing, which is expected to take place July 1. Through the acquisition, Swedencare will receive a strong presence within manufacturing and development of premium products and brands for the animal health market in the US and Canada.

Vetio operates a pharma services business model, providing contract drug development and manufacturing for the leading animal health companies around the world. Customer relationships are long term, and based on extensive capabilities, intellectual property, know-how, and capacity designed specifically for veterinary drugs. Vetio has built a strong backlog for drug development, technical transfers, and manufacturing after completing an FDA facility expansion in Montreal two years ago.

Vetio is characterized by high growth and is in the final stages of completing another large investment in the fall of 2021 for their site in Jupiter, Florida with new capabilities to manufacture nutritional pet supplements, and to improve operating efficiency to meet the increasing customer demand and investment in novel product offerings.

Vetio’s sales were $32.3 million full year 2020 with an adjusted EBITDA of $6.5 million (20%). Corresponding sales for TTM April 2020 – March 2021 were $35.0 million and an adjusted EBITDA of $7.6 million (22%). Corresponding sales for TTM June 2020 – May 2021 were 37.9 million USD and an adjusted EBITDA of $8.6 million (23%).

The purchase price of $181,5 million on a cash- and debt free basis, correlates to approximately 21 times the adjusted EBITDA of TTM June 2020 – May 2021.

“Through the acquisition of Vetio, by far our largest to date, we take a big leap towards our goal to become the leading global animal health group within nutraceutical and dermatology premium products to pets and companion horses. Through the acquisition we increase our group’s inhouse production for both our own brands and partners within white label together with solidifying product development and a portfolio of proprietary palatants and technical know-how of e.g., Soft chews (with IP) perhaps the fastest growing product category in the business. Together with Vetio and their excellent management we create a stronger and wider product offering together with significantly scaling up our presence in North America and receives a business relationship with many new interesting customers. Vetio has grown fast and accelerates further with the expansion and inauguration of the new production facility this fall in Florida,” said Swedencares CEO Håkan Lagerberg.

Vetio will continue to be led by CEO John Kane, together with his highly skilled and experienced management team whom all will become shareholders in Swedencare through their current minority holding of Vetio which partly is settled in the purchasing settlement through shares in Swedencare.

“Swedencare’s acquisition of our company validates the Vision for Vetio and what we have built. Vetio’s reputation as a leading CDMO in Animal Health is based on the hard work and our mission to Actualizing Animal Health, a mission that aligns well with Swedencare. We are committed to the development and manufacturing of products that improve the lives of animals, while assuring the safety, quality, and compliance of our products to the highest industry standards, a commitment that we are eager to realize together with Swedencare,” said Kane.

Thompson Street Capital Partners (TSCP) has been the majority owner of Vetio, and TSCP managing director Matt Scherrer added:

“Vetio has been a ‘buy and build’ platform for TSCP. Via two acquisitions and a close partnership with a talented management team led by John, Vetio has become a significant player in animal health drug development and manufacturing. We are very pleased to see Vetio partner with Swedencare and realize the strategic initiatives that have been effected by Vetio and TSCP.”

The group, after the acquisition of Vetio, had TTM April 2020 – Mars 2021 (pro forma) sales of approximately $100 million (865 MSEK) with an EBITDA of approximately $26 million (221 MSEK), corresponding to an EBITDA of 26%.

Further information in regard to the acquisition can be found on the website of Swedencare Further information about Vetio can be found at

The board of Swedencare has decided to investigate the possibility to initiate a directed new share issue of 1 150 MSEK to a limited number of Swedish and international investors which together with an acquisition bank credit of 400 MSEK from Handelsbanken, will finance the acquisition of Vetio. The outcome of this will be published before the market opens on the 29th of June 2021.

The Law firm Advokatfirman Lindahl KB and Grant Thornton LLP have assisted Swedencare with advice in the transaction. TSCP was advised by Sidley Austin and Stifel Investment Banking.