Woolworths Group is exploring joint value creation opportunities with a specialty retail business in Australia and New Zealand.
Woolworths has agreed to acquire a 55 per cent equity interest in pet food, accessories and services retailer, Petspiration Group. It is the owner of PETstock and has a network of 276 stores as well as a loyalty program with 2.4 million members.
“Specialty pet is a large and growing retail segment in which we have limited presence,” said Woolworths Group CEO, Brad Banducci.
“We are delighted to be investing alongside founders, Shane and David Young, in Petspiration, the number two player in the segment.
“Specialty pet is a logical adjacency given the high penetration of pet ownership across Australia and New Zealand. The partnership will allow us to meet more of our customers’ pet family needs with a complementary range of specialty pet products and services, strengthen the Everyday Rewards loyalty program and unlock opportunities for material value creation across both businesses.
“We will work together to support Petspiration’s growth through access to our retail capabilities in areas such as Digital and eCommerce, Supply Chain, Retail Media, Format and Network Development, and Advanced Analytics.
“We are confident that this investment will deliver a strong return on investment for Woolworths Group shareholders.”
Shane and David Young (and other existing shareholders) will retain a 45 per cent equity investment in the business and continue as CEO and Managing Director respectively, running Petspiration as a stand-alone business within Woolworths Group, under a separate board and governance structure.
Within Woolworths Group, Von Ingram, the newly appointed Managing Director of W Living, will assume responsibility for bringing the partnership to life and unlocking the value creation opportunities across the Group.
“This is a unique opportunity to partner with Woolworths Group to continue to grow and strengthen the business we founded in Ballarat just over 30 years ago,” said Shane Young.
“We will operate independently of Woolworths Group but will work closely together through our common values to deliver on all the opportunities we have to jointly create value for our pet families and supplier partners.”
Woolworths’ supply chain arm, Primary Connect, will be expected to bolster store network growth and provide supply chain capability.
The transaction remains subject to customary closing conditions including ACCC and NZCC approvals with completion expected in mid calendar 2023.
In other news, BevChain signed a new warehousing agreement with Primary Connect in New South Wales.
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