LOS ANGELES — VCA Inc., which consolidated chunks of the pet health industry to grow into a leading chain of animal hospitals, agreed to be bought by candy and pet-care giant Mars Inc. for $7.7 billion in cash, the companies said Monday.
Mars already owns Vancouver-based Banfield Pet Hospitals, many of which are in PetSmart Inc. retail locations.
Los Angeles-based VCA operates nearly 800 animal hospitals and 60 diagnostic laboratories in the United States and Canada.
The firm employs 23,000 people and had 2015 revenue of $2.1 billion.
The deal calls for Mars to pay $93 for each of VCA’s shares and to assume VCA’s $1.4 billion in debt. VCA’s stock — whose ticker symbol is WOOF — soared $20.02, or 28.3 percent, to $90.79 a share in trading Monday.
“VCA is a leader across pet health care and the opportunity we see together — for pets, pet owners, veterinarians and other pet care providers — is tremendous,” Mars Chief Executive Grant Reid said.
The deal was approved by both companies’ directors, but remains subject to approval by VCA’s stockholders. It is expected to be completed in this year’s third quarter.
Mars, which is based in McLean, Va., and has $35 billion in annual sales, is the privately held maker of such candy brands as M&M’s, Snickers, Milky Way, Skittles, Dove chocolate and Wrigley’s gum.
The century-old company also has a major pet-care unit whose pet food brands include Pedigree, Whiskas and Sheba.
“We simply believe Mars … found VCA to be an attractive long-term asset, and we would expect the two businesses to complement one another quite nicely,” analyst Nicholas Jansen of the investment firm Raymond James & Associates said to clients.
In a memo to its employees, VCA said it would remain based in Los Angeles and continue to operate under the VCA name as part of Mars.
VCA said that its employees’ “tenure and seniority with VCA . will be maintained” and that the Mars deal would offer them “enhanced career-development opportunities.” The companies did not indicate whether any job cuts are contemplated for after the deal closes.
VCA said that it did not seek out the Mars offer, but that, as a publicly held company, it “had a responsibility to consider the opportunity carefully.”
Originally called Veterinary Centers of America Inc., VCA was started in 1986 by founders who included brothers Robert and Arthur Antin.
Robert Antin is VCA’s chief executive and Arthur Antin is its chief operating officer. VCA said they and other members of its senior management would stay with the company after the Mars acquisition.
VCA consolidated big chunks of the fragmented veterinary and pet-care industry, mostly by using acquisitions to combine hospitals, diagnostic labs and veterinarians into a single network. California is the firm’s largest market.
