ZOOPLUS agrees €3bn private equity takeover – Effect on Columbus fund
On Friday last week (13th August) our position in Zooplus, the German online pet supplies retailer, soared by 40% to €390 per share on news that management had agreed a €3bn all-cash takeover bid by US Private Equity group Hellman & Friedman.
Prior to the takeover the Columbus fund held a 2.6% position in Zooplus having originally purchased the stock in August 2020. Before the bid was announced the shares had already performed well, returning 73% since our initial purchase. The bid comes just over two weeks after the announced acquisition of another fund holding, Akka Technologies.
Zooplus was a beneficiary of the covid disruption, as both the penetration of online shopping and pet ownership across Europe rose sharply as people were forced to stay at home. In 2020 the Group’s revenues surpassed €1.8bn, up just over 18% in the year. We anticipate that Zooplus will continue to benefit from these trends in the long-term, with the Group forecasting total online sales in the European pet supplies category to rise 4-fold over the coming decade with the sector achieving sales (including traditional channels) of close to €50bn by 2030. Following the deal Zooplus’ management team are expected to stay in post and both the executive and supervisory boards and see the deal as bringing “additional sector expertise, hands-on support, the financial firepower, and a stable ownership structure to expand its (Zooplus) competitive lead and secure sustainable long-term growth.”
From Columbus’ perspective, it is gratifying that others appreciate the value and growth potential that we saw in the stock. Having reviewed the European online retail space in early 2020 we selected Zooplus over better known listed players after being drawn to the increasing penetration of pet product sales over the internet, Zooplus’ early lead in this market and their impressive operational performance. We believe they have a strong future ahead.
(Source of the image: zooplus)
