January 29, 2021

Willkie represented Franchise Group in the transaction.

On January 25, Franchise Group, Inc. (NASDAQ: FRG) announced that it entered into a definitive agreement to acquire Pet Supplies Plus (PSP), a leading omnichannel retail chain and franchisor of pet supplies and services, in an all cash transaction valued at approximately $700 million from affiliates of Sentinel Capital Partners. The transaction is expected to result in systemwide annualized revenue for Franchise Group, defined as total sales for both franchise and company units, of more than $3.6 billion.

Founded more than 30 years ago, PSP is a mature and rapidly growing pet industry franchisor with a footprint of more than 500 locations, of which almost 60% are franchised. PSP is a leading franchisor in the pet industry, offering varied cost-competitive shopping options through its neighborhood locations, direct-to-consumer local delivery and buy-online-pickup-in-store model. For fiscal year 2020, PSP is estimating total systemwide revenue of approximately $1.2 billion, company revenue of over $825 million and Adjusted EBITDA of nearly $80 million.

Franchise Group is an operator of franchised and franchisable businesses that continually looks to grow its portfolio of brands while utilizing its operating and capital allocation philosophy to generate strong cash flow for its shareholders. On a combined basis, Franchise Group currently operates over 4,100 locations predominantly located in the U.S. and Canada that are either company-run or operated pursuant to franchising agreements.

The Willkie team was led by partners Daniel Mun and Russell Leaf, and included partners David Tarr, Guy Inbar and Rose Ohanesian and associate Frances Dales.