Pet accessories merger goes for the GOLD

The $605m Golub One Loan Debt facility, the largest to date, will be used to finance a merger between Pet Valu and Pet Supermarket.  

Golub Capital provided a $605 million debt facility that will be used to support the merger of two pet food and accessories suppliers, the firm announced Monday (11 July).

Golub acted as administrative agent, sole bookrunner and joint lead arranger on the facility, which the firm offered under its proprietary suite of Golub One Loan Debt (GOLD) facilities. The unitranche loan is understood to have been syndicated among about 10 other unnamed lenders.

A Golub representative declined to provide more detail on the transaction.

Pet Valu has 514 stores across nine provinces of Canada and an additional 257 stores in the United States. Pet Supermarket operates 165 premium pet supply stores, mostly in the Southeastern US. Both companies are Roark Capital portfolio companies and the merged company, to be called Pet Retail Brands, is expected to be the largest, small format, neighborhood pet specialty retailer in North America.

The size of the debt facility demonstrates how alternative lenders such as Golub have recently been able to finance larger unitranche transactions. Last month, Ares worked with a group of other underwriters to provide a $1.075 billion unitranche facility to support Thoma Bravo's acquisition of Qlik Technologies.

Golub's GOLD loan announced Monday (11 July) is its largest GOLD facility offered to date, surpassing the $515 million facility Golub provided last June in support of Behrman Capital's recapitalization of Data Device Corporation.

“As banks change their focus, people like us are moving up in size and capabilities,” said Andrew Steuerman, head of mid-market lending at Golub, in an interview.

Roark Capital is a private equity firm with $6 billion in assets and a focus on mid-market consumer, environmental and business service companies. Named after the protagonist of Ayn Rand's The Fountainhead , the firm is based in Atlanta and maintains an office in New York.

Golub maintains distinct business lines focusing on mid-market lending, late stage lending and broadly syndicated loans. The firm has over $18 billion in capital under management and maintains offices in Chicago, New York and San Francisco.