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Petco operates more than a thousand pet care centers that sell supplies but also offer services.
Bruce Bennett / Getty Images
Poshmark
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Petco Health & Wellness Co.,
the last participants in the stock market boom entered the equity markets on Thursday. Poshmark shares soared about 142%, while Petco gained about 83%.
Shares of Poshmark (ticker: POSH) opened at $ 97.50 and reached a high of $ 104.98. Shares closed at $ 101.50 on Thursday, up 141.7%
The strong performance came after Poshmark raised $ 277.2 million after selling 6.6 million shares at $ 42, above its price range of $ 35 to $ 39.
Morgan Stanley, Goldman Sachs and Barclays are the signatories to the deal.
Poshmark operates a marketplace that allows consumers to buy and sell new and used items such as shoes, clothing and jewelry. As of September 30, the company had 4.5 million active sellers, offering more than 201 million second-hand and new items to 6.2 million active buyers. Poshmark charges a 20% fee for sales of € 15 or more.
Petco also debuted Thursday, trading on the Nasdaq under the WOOF brand. Shares opened at $ 26 and rose to a high of $ 31.08. Shares ended at $ 29.40, up 63.33%.
“The IPO has exceeded our expectations,” said Ron Coughlin, CEO of Petco. “Really smart investors believed in our strategy and our people. It’s an exciting day for Petco. “
The San Diego company raised $ 864 million, more than expected. Poshmark’s IPO raised $ 272.2 million after setting a price well above the expected range.
On Wednesday afternoon, Petco, a pet health and welfare company, sold 48 million shares at $ 18 each, above the $ 14-17 range it had told investors to wait. Goldman Sachs and BofA Securities are the subscribers to the deal.
Petco, which no longer calls itself a retailer, operates around 1,470 animal care centers that sell food, toys and supplies, while offering professional services such as animal cleaning, veterinary care and pet training.
Coughlin said all proceeds from the IPO will help reduce Petco’s debt burden by $ 3.24 billion. The company’s debt payments will be halved, he said. This will allow Petco to grow its business even further, he said.
“There are a lot of growth opportunities without having to make acquisitions,” Coughlin said De Barron. Petco’s veterinary business has grown to 105 clinics this year, up from 15 a year ago, while its digital business grew 30 percent in the third quarter, he said. Coughlin said same-day delivery accounts for 30 percent of e-commerce orders.
CVC Capital Partners and the Canadian Investment Plan Investment Board will own nearly 67% of the company after the IPO. The shares had been publicly traded before, but the company withdrew both times privately.
The pet care industry has long been considered a test of recession, as pets are increasingly considered family members. The industry in 2020 accounted for more than 72 million pet homes and a total market of $ 97 billion. The Covid-19 pandemic, which led to an increase in pet adoptions, is expected to help the sector grow 7% annually by 2024, according to Petco’s brochure.
Petco is one of the few end-to-end service providers for pet owners. Their stores offer food, preparation and training, as well as veterinary services. “Owning a pet can be overwhelming,” Coughlin said. “Having to go to one place to prepare, another place to train … only Petco can bring them together in a fantastic way.”
Write to Luisa Beltran to [email protected]