Coles Group has ended discussions with private equity firm TPG Capital over a potential acquisition of Greencross Pet Wellness Company, walking away just over two weeks after confirming it was undertaking due diligence on the pet retail and veterinary group.
In a statement to the ASX on 17 July, Coles gave no reason for ceasing discussions beyond it applying “a disciplined approach to acquisitions”.
“As one of Australia’s leading retailers, [Coles] regularly assesses strategic opportunities that may complement its existing business,” the company said.
Coles confirmed it was in talks with TPG on 1 July, responding to media speculation about a deal first reported by The Australian Financial Review and said to value Greencross at around $4 billion including debt.
At the time, Coles said it would only pursue an acquisition where it was satisfied the transaction was “strategically compelling and capable of delivering attractive shareholder returns”, noting discussions were incomplete and there was no certainty a transaction would proceed.
Greencross owns the Petbarn and City Farmers retail chains and the Greencross Vets network, with more than 240 stores and 160 veterinary clinics and hospitals. TPG took the business private in 2019 in a deal worth $675 million, and Greencross has since passed $2 billion in annual revenue.
An acquisition would have been Coles’ first major move beyond its supermarkets, liquor, and convenience operations, and the first major deal under CEO Leah Weckert. The group closed its own online pet care business, Swaggle, in March.
The market response to the due diligence confirmation was cool, with Coles shares falling more than four per cent amid investor concerns over price and strategic fit.
A completed deal would have deepened the pet care contest between the major supermarkets. Woolworths Group acquired a 55 per cent controlling stake in Petstock owner Petspiration Group for $586 million in 2024.
The decision comes ahead of Coles’ full year results in August. In its third quarter update, the group reported four per cent supermarkets sales growth, while liquor revenue fell 3.9 per cent. Its half year results showed group EBIT excluding significant items up 10.2 per cent to $1.23 billion.
