PetIQ, Inc. Receives FTC Approval to Close Acquisition of the Capstar Portfolio of Products

Expects to Complete Accretive, Strategic Transaction on July 31, 2020

Capstar Product Portfolio Provides PetIQ a High-margin Revenue Opportunity and Further Bolsters Manufacturing

EAGLE, Idaho, July 16, 2020 (GLOBE NEWSWIRE) -- PetIQ, Inc. (“PetIQ” or the “Company”) (Nasdaq: PETQ), a leading pet medication and wellness company, today announced they have received  final approval from the U.S. Federal Trade Commission (“FTC”) and will close the $95 million cash acquisition of the Capstar portfolio of products from Elanco Animal Health, Inc. (“Elanco”) (NYSE: ELAN) on July 31, 2020.  Capstar is the #1 oral over-the-counter (“OTC”) flea treatment product in the United States. PetIQ expects that this acquisition will be immediately accretive to earnings following the closing and thereafter due to the strong performance of the brand.

The Capstar portfolio is comprised of seven SKUs, including three private label SKUs which are sold under the Capaction brand.  Capstar is an oral tablet for the treatment of flea infestations on dogs, puppies, cats and kittens and is currently the best-selling oral OTC flea treatment product in the United States.  Additionally, Capstar is the only oral OTC product for cats in the market today. 

Cord Christensen, PetIQ’s Chairman and Chief Executive Officer, commented, “We are excited to have cleared all hurdles needed to close this highly accretive acquisition. We believe the acquisition of Capstar is a natural fit with our pet health and wellness platform as we further enhance PetIQ’s manufactured product business with the addition of Capstar’s industry leading animal health product portfolio. We have been distributing the Capstar brand for several years and have a deep appreciation for the trust that pet parents have in their flea treatments, which is demonstrated by their very attractive position.  We believe that PetIQ is well positioned to support and grow Capstar across sales channels long-term.” 

Strategic and Financial Benefits

PetIQ believes the combination will provide the following strategic and financial benefits:

• Further Diversifies and Expands PetIQ’s Manufactured Pet Health and Wellness Branded Product Offerings: The addition of the Capstar portfolio complements PetIQ’s existing portfolio of manufactured products, which was recently expanded by the addition of products sold under the brands of Perrigo Animal Health.  The acquisition further supports the Company’s product category, brand, and sales channel diversity with a focus on accessible and affordable, high-quality flea infestation treatments.