Central Garden & Pet Company (CENT) M&A announcement summary

Deal rationale and strategic fit

• Acquisition of a majority (80%) stake in TRIXIE, a leading European pet supplies company, accelerates European expansion and creates the largest global pet supplies company.

• TRIXIE's strong logistics, premium branded products, and innovation capabilities provide a scalable platform to consolidate the fragmented European market.

• The deal supports long-term strategy to build consumer-loved brands and expand the pet and garden portfolio.

• Cultural fit between management teams and continued involvement of minority shareholders ensure continuity and alignment.

• Establishes a differentiated presence with about 10% of net sales generated outside the US.

Financial terms and conditions

• €340MM upfront cash consideration for 80% stake, with total consideration up to €400MM if full earn-out is achieved.

• Transaction completed at a high single-digit EBITDA multiple, considered attractive and pre-synergies.

• Two senior management members will remain with the business post-transaction, with Dirk Jessen and Volker Haak retaining minority interests.

• Post-closing net leverage expected to remain around 1.5x.

• Deal was conducted through an auction process.

Synergies and expected cost savings

• Cost synergies expected through leveraging logistics, sales force, and sourcing capabilities.

• Revenue synergies anticipated by cross-selling and introducing products across geographies.

• Clear pathway to annual cost synergies and improved margins starting in year 2 post-closing.

• Opportunity to enhance e-commerce capabilities and product mix, especially in consumables.

• Combination expected to drive organic growth through innovation and strong channel presence.