Blackstone to Privatize Pet Care Giant Rover Group in $2.3 Billion All-Cash Deal

Under the terms of the agreement, Rover's shareholders will receive $11 per share, representing a substantial premium of 29.4% over the last closing price of the company's stock.

In a significant financial move, pet care company Rover Group (ROVR.O) has announced its plans to go private through a $2.3 billion all-cash deal with private equity firm Blackstone (BX.N).

This announcement comes as Rover seeks to transition from being a publicly-traded entity to a privately-owned company.

Under the terms of the agreement, Rover’s shareholders will receive $11 per share, representing a substantial premium of 29.4% over the last closing price of the company’s stock.

Remarkably, this deal was initiated by Blackstone itself, as it approached Rover directly with the proposal, even though Rover was not actively seeking a buyer.

In a show of openness to alternative offers, Blackstone has granted Rover a 30-day “go-shop” period during which the company can consider superior offers from other interested parties.

It’s worth noting that Blackstone has a history of sidestepping competitive sale processes by taking the initiative to put companies in play, as it did recently with software provider Cvent and the eBay (EBAY.O)-backed online classifieds group Adevinta (ADEA.OL).

While Blackstone intends to acquire Rover without incurring any debt commitments initially, sources suggest that the firm may consider adding debt to the company at a later stage.

Rover has established itself as an online marketplace where pet care providers offer a range of services, including dog walking and in-home pet sitting.

The company went public in 2021 through a special-purpose acquisition company.

The pet care industry is known for its resilience in economic downturns, as pet owners often consider their furry companions as cherished family members and prioritize spending on premium pet food, care, and veterinary services.

Since its inception in 2011 through the end of September 2023, Rover has facilitated over 93 million pet care services booked by more than 4 million pet parents.

In this process, over 1 million pet care providers have been compensated across North America and Europe.

In response to this news, Rover’s stock price experienced a significant surge, with shares rising by 29% to close at $10.96 on the day of the announcement.

The transaction is anticipated to be finalized in the first quarter of 2024, marking a significant milestone in Rover’s journey as it transitions to a privately-owned company under the wing of Blackstone.