Patient Square Capital to Acquire Patterson Companies for $4.1 Billion
USA, Wednesday, 11 December 2024.
Patient Square Capital has agreed to acquire Patterson Companies for $4.1 billion, offering a 49% premium per share. The deal is expected to close in fiscal 2025.
Deal Details and Premium
Patient Square Capital will acquire Patterson Companies (Nasdaq: PDCO) for $31.35 per share in cash [1][3], representing a 49 percent premium over Patterson’s 30-day volume-weighted average price ending December 4, 2024 [2][3]. The total transaction value, including the refinancing of Patterson’s receivables facilities, amounts to approximately $4.1 billion [1][3]. The announcement on December 10, 2024, led to an immediate market response, with Patterson stock surging 35.9% to $31.40 at market close [2].
Strategic Implications
Following the acquisition, Patterson Companies will transition from a publicly traded company to a private entity, delisting from the NASDAQ Global Select Market [1]. The company will maintain its headquarters in St. Paul, Minnesota [1]. The deal’s financing structure combines equity funding from Patient Square Equity Partners, LP, and debt financing led by major financial institutions, including a commitment of up to $1.85 billion in term loans, $500 million in bridge loans, and a $900 million revolver [1].
Go-Shop Period and Regulatory Approvals
The merger agreement includes a 40-day go-shop period, allowing Patterson’s Board to actively seek alternative acquisition proposals [1][2]. This period will end on January 19, 2025 [2]. However, analysts from Evercore suggest that a competing bid is unlikely, with Patient Square expected to prevail [2]. The transaction requires various approvals, including shareholder consent and regulatory clearances, with an anticipated closing in the fourth quarter of Patterson’s fiscal 2025 [1][3].
Market Position and Future Outlook
Patterson Companies operates as a significant distributor in the dental and animal health markets, serving customers across North America and the UK [4]. The acquisition by Patient Square Capital, a dedicated healthcare investment firm, positions Patterson for continued growth in these sectors [3]. The transaction has received unanimous approval from Patterson’s Board of Directors, excluding CEO Don Zurbay due to his position as a Management Director [1][3].