Case Study

Overview

• Zuke’s is a leading independent provider of branded companion animal treats.
• The company is a pioneer in healthy, semi-moist and fortified treats, which are manufactured domestically using premium grade ingredients sourced predominantly in North America.
• Zuke’s core values include a commitment to quality, boasting a near flawless production track record, having never had a recall.
• The company became the go-to brand for a comprehensive treat solution in pet specialty, among both major chains and independents.

Situation

•  Zuke’s received an investment from private equity firm Encore Consumer Capital in 2009, enabling the company to increase spend in product development, sales, and marketing.
• Since receiving the private equity investment, Zuke’s experienced rapid growth having increased doors, SKUs, facings and turns across its retailer platform.
• Ownership recognized that Zuke’s had a clear path to becoming a $100 million brand, but had several key hurdles to achieving that goal.
• The inflection point of the company proved to be good timing to pursue a transaction, providing historical growth while leaving a road map to future growth.

Cascadia Process

• Cascadia ran a limited strategic process in order to solicit terms from the most likely acquirers while limiting the company’s exposure.
• Given the institutional ownership and return objectives, the valuation threshold was aggressive, quickly narrowing the field to the most bullish candidates.
• Cascadia understood the demand for the company and used that to run a two-step auction process that required all interested parties conduct full business due diligence and comment on definitive documents prior to exclusivity.
• Through its process, Zuke’s received multiple bids which were in excess of the projected market clearing price, ultimately choosing to partner with Nestle Purina PetCare.