Shore Capital, Silver Lake In Talks Over $8.6 Billion Pet-Care Deal

(Bloomberg) -- Shore Capital Partners, the private equity firm led by Justin Ishbia, is in talks with Silver Lake Management to partner to combine two veterinary groups through an $8.6 billion deal, people familiar with the matter said.

Chicago-based Shore is working to merge portfolio companies Southern Veterinary Partners and Mission Veterinary Partners and recapitalize the combined entity with an investment from Menlo Park, California-based Silver Lake, according to the people.

Shore and Silver Lake would co-own the combined entity, the people said, and together contribute about $4 billion of fresh equity to the company. The financing for the deal would also include about $3 billion of secured debt and some preferred equity, they said.

Deliberations are ongoing and no final decisions on the terms of a transaction have been set, the people said, asking not to be identified discussing confidential information. A representative for Silver Lake declined to comment. Spokespeople for Shore, Southern Veterinary Partners and Mission Veterinary Partners couldn’t be reached for comment.

Any combination of Southern Veterinary Partners and Mission Veterinary Partners would create one of the largest operators of animal hospitals in the US and come as Americans spend increasing amounts of money on keeping their pets healthy — a trend that has been drawing more private equity investors to the sector.

Southern Veterinary Partners operates more than 420 animal hospitals and pet resorts across the US, according to its website. Shore has been an investor in the company since 2014. Mission Veterinary Partners was founded in 2017 and has a network of over 330 clinics, its website shows. Opposition to plans to merge Southern Veterinary Partners and Mission Veterinary Partners was raised in an online petition in June.

Ishbia is part of a group led by his brother Mat Ishbia that owns a majority of the National Basketball Association’s Phoenix Suns. Mat Ishbia is worth an estimated $6.6 billion, according to the Bloomberg Billionaires Index.