National Veterinary chain is sold
Stan Creighton’s goal of building a major veterinary-hospital chain got a big boost on Thursday: His Westlake Village-based company, National Veterinary Associates, was sold to Summit Partners, a Silicon Valley venture capital firm.
Summit said the deal amounted to a $128-million investment in National Veterinary, which Creighton formed in 1996 and which now owns 96 animal hospitals in 29 states.
The company says it’s the largest private owner of veterinary hospitals. But it’s much smaller than its crosstown rival, Los Angeles-based VCA Antech Inc., a publicly traded firm that owns 375 hospitals nationwide.
“We wanted to invest in the company because we see wonderful growth ahead,” said Dr. Craig Frances, a Palo Alto-based general partner of Summit, which bought its majority stake from private equity firm Willis Stein & Partners in Chicago.
“People have increasingly treated their pets like family members,” Frances said. That naturally translates into a greater willingness to spend on the animals’ healthcare, he added.
Creighton, who said his household had one pet (a feline), declined to give specifics on the company’s financials but said, “We’re quite profitable.” Annual sales are between $100 million and $200 million, he said. That compares with VCA Antech’s sales of nearly $1 billion in 2006.
Creighton, 60, was a veterinarian for 24 years before launching National Veterinary a decade ago. He said his idea was to give vet doctors a “financial exit” strategy for the wealth tied up in their businesses, while allowing them to continue to practice. Under one corporate umbrella, the individual hospitals also benefit by consolidating functions such as purchasing.
With the investment from Summit, “we want to ramp up the acquisition pace,” Creighton said. The firm has been buying eight vet hospitals a year on average, he said.
The field is wide open, Creighton said: There are more than 20,000 vet hospitals nationwide.
Summit, which has financed nearly 300 companies since 1984, said it was too early to talk about the possibility of a public stock offering. But Wall Street has been a big fan of VCA Antech. The company’s stock, which gained 54 cents to $38.17 on Thursday, has soared 663% since its IPO in 2001. That’s more than 15 times the gain of the Standard & Poor’s 500 index since then.
