Blackstone paying $2.3 billion to acquire Rover

Blackstone will shell out $11 per share to acquire Rover and turn the pet care services platform back into a private company. 

The deal, unveiled Wednesday, will involve all cash to the tune of $2.3 billion in total. The companies have pegged the first quarter of 2024 as when completion of the transaction should occur, provided it clears regulatory and closing requirements and gets the go-ahead from shareholders, according to Rover and Blackstone press releases. 

Blackstone will remove Rover Group’s shares from the Nasdaq exchange when the asset management firm finishes the acquisition, the companies said. 

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“Our investment highlights Blackstone’s high-conviction focus on backing rapidly growing digital businesses and supporting talented entrepreneurs with extensive resources to take advantage of transformational growth opportunities,” Blackstone Senior Managing Director Sachin Bavishi said in a statement. “We look forward to working with Rover as they continue working to drive innovation for pet owners and providers.”

In the first three quarters of the year, Rover has generated $165.85 million in revenue and $5.59 million in net income. It reported 5.02 million bookings in the same nine-month time frame, marking a 22% year-over-year increase. 

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Under a “go-shop” period, Rover will have until Dec. 29 to “solicit, consider and negotiate alternative acquisition proposals from third parties,” according to the companies. They said there “can be no assurance that this ‘go-shop’ process will or will not result in a superior proposal.”

Investors seemingly reacted positively to the acquisition agreement, with Rover seeing an over 28% boost in its stock price compared to where it opened Wednesday morning. From the start of the year, its shares have climbed nearly 170%.

Blackstone said the pet care services platform would keep its name and brand following completion of the deal.

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The firm, run by CEO and co-founder Stephen Schwarzman, manages $1 trillion worth of assets.