IVC Evidensia eyeing further growth as capital plan pondered

Hundreds of millions of pounds are set to be invested into continuing development and expansion of one of the world’s biggest veterinary care providers.

The plan has emerged after a UK regulator gave itself more time to consider IVC Evidensia’s proposal to sell off eight acquired businesses in response to a competition inquiry.

Documents seen by Vet Times reveal the company, which made nearly £1 billion in gross profits last year, is working with its major investors on a plan to raise additional capital.

Although few details have been released, the initiative could see up to £800 million pumped into the business to help facilitate investments in the company’s existing practices and systems, as well as further acquisitions.

Big profits

A company spokesperson said: “IVC Evidensia has grown strongly over the past two years and is considering options to fund its continued growth.”

The investment plan is being developed amid continuing optimism among bosses about the underlying strength of the veterinary sector, despite the economic pressures being felt by many pet owners.

The papers reported gross profits of £953 million in the 2022 financial year, while its revenues jumped from £1.31 billion in 2020 to £2.84 billion last year.

The papers reported gross profits of £953 million in the 2022 financial year, while its revenues jumped from £1.31 billion in 2020 to £2.84 billion last year. The company’s pro forma EBITDA level also more than doubled over the same period, from £248 million to £581 million.

The documents described the company’s main investors were said to be “excited” by the opportunities offered through the plan.

They continued: “The veterinary industry continues to be a very attractive market with long-term growth tailwinds, including humanisation of pets, increasing willingness to spend and recession resiliency.”

CMA probe

IVC has previously insisted its approach to potential UK expansion had not changed, despite its offer to divest itself of eight veterinary businesses after their acquisitions were investigated by the Competition and Markets Authority (CMA).

In March, the CMA said there were “reasonable grounds” to believe IVC’s offer to divest the enterprises concerned would address potential losses of competition that it had identified in relation to the deals, which were completed during 2021 and 2022.

But the deadline for a final decision on the proposals has now been pushed back to 30 June, from early May.

The latest update on the CMA’s website, dated 28 April, said extra time was needed to assess and consult on proposed buyers for the businesses concerned, though there was “sufficient likelihood” that the company’s undertakings would be accepted before the end of June.

IVC said it had no further comment on the CMA update.

• This article was updated on 5 May to include the EBITDA figure.