KBS - Pet Sector - Market Insight

CURRENT LANDSCAPE Several key trends have shaped the UK M&A market in the pet sector in recent years.

Premium Products: Following an increase in customer-driven demand for specialised pet food products, many deals have been motivated by acquiring companies who presently produce such products or have the capabilities to do so. Private Equity: PE firms account for a lot of M&A activity in the pet sector. In an evolving market, many established companies are offering a strong market position and growth potential. Cost Synergies: Firms are looking to acquisitions for significant cost savings presented through economies of scale, streamlined operations and shared resources with synergistic operators, helping to enhance profitability. ACQUISITION SYNERGIES Operational Synergies: Several manufacturers combining their operations can lead to enhanced efficiency, reduced duplication of resources and improved service delivery. Financial Synergies: The right acquisition, or sale, can improve access to capital, optimise the complex cost structures that pet sector manufacturers and retailers typically navigate, and enhance financial performance through better cashflow management. Knowledge and Expertise: Merging with or acquiring manufacturers with specialised expertise can accelerate innovation and enhance the acquirer’s capabilities in new operational practices.

The global pet care market exceeded $150bn annually for the first time in 2024 and is forecast to surpass $200bn by 2030.