Private Equity Giants Near $8.6bn Veterinary Merger

Shore Capital Partners and Silver Lake are in talks over a possible $8.6 billion combination of two Shore veterinary platforms.

The proposed merger would combine Shore portfolio companies Southern Veterinary Partners (420+ locations) with Mission Veterinary Partners (330+ clinics) and recapitalize the combined entity with $4 billion in new equity from the sponsors, plus around $3 billion in secured debt and preferred equity.

If the deal goes through, the combined business would be one of the largest veterinary providers in the U.S., reaching a scale comparable to Mars Inc.’s 2,000-practice Banfield/VCA and JAB Holdings’ 1,000-hospital National Veterinary Associates.

Shore acquired a three-hospital Southern Veterinary Partners in 2014 as the first purchase out of its $113 million debut fund. At the time, managing partner Justin Ishbia outlined a thesis around rapid high-volume add-ons of small practices with EBITDA of between $1 to $5 million, which he believed could be done at multiples between 4 to 6 times.

In 2017, the firm separately formed Mission Veterinary Partners through the merger of two recently acquired practices. Shore later tested the market for Mission in 2021 with a pro forma adjusted EBITDA of around $160 million, which included contribution from its pipeline of add-ons under LOI.

Shore opted to extend its hold after valuation expectations weren’t met, in part because of buyer reluctance to give full credit to the pro forma adjustments (the core business’ EBITDA was thought to be closer to $100 to $120 million).

For Silver Lake, the deal would be the firm’s second veterinary holding, following its €3.5 billion joint investment with Nestlé into EQT-owned IVC Evidensia, Europe’s largest veterinary group.

That deal shared some similarities with the current proposal: Silver Lake put cash into a strong asset while providing optionality to the existing sponsor—EQT sold the stake held by its 2015 vintage fifth fund and bought back in through its ninth fund.

If Shore and Silver Lake do reach an agreement, antitrust might prove the bigger hurdle. On top of its increased healthcare private equity scrutiny, the FTC has already taken a dim view of veterinary consolidation.

In 2022, JAB entered into a consent decree with the FTC requiring it to seek prior approval before purchasing any clinics within 25 miles of an existing California or Texas location for the next decade. In written comments, Chair Lina Khan expressed concern over the potential for a stealth monopoly built from small add-ons—uncomfortably close to the Shore playbook.