FTC Details Action to Protect Competition in Emergency and Specialty Veterinary Clinics

The Federal Trade Commission (FTC) issued a press release on Wednesday announcing action they had taken against JAB Consumer Partners, a private equity firm. The FTC required JAB to divest clinics across the country and imposed strong prior approval and notice on the firm.

JAB Consumer Partners, per the release, is a private equity firm seeking to consolidate their control over specialty and emergency veterinary clinics. JAB’s most recent endeavor seeks to acquire the parent company of the veterinary clinic owner Ethos, an acquisition that would total $1.65 billion.

JAB Consumer Partners owns two separate firms, Compassion-First Pet Hospitals and National Veterinary Associates, Inc., that each operate chains of veterinary clinics. The specialty and emergency veterinary clinics are operated across nine states.

The FTC alleged that the proposed acquisition would result in anticompetitive environments in Richmond, Washington, D.C., Denver, and San Francisco since the markets are already described as being “highly concentrated.” The FTC’s action against JAB orders them to divest clinics in Richmond, Denver, San Francisco, and Washington, D.C. in order to proceed with the acquisition. In addition to this requirement, the FTC imposed strong prior approval and prior notice requirements on JAB’s future acquisitions.

Holly Vedova, the Director of the Bureau of Competition, said of the FTC’s recent action, “the FTC is taking action to prevent private equity firm JAB from gobbling up competitors in regional markets that are already concentrated. Divestitures will help preserve current competition, and the prior notice and approval requirements will allow the FTC to keep a close watch on these markets moving forward.”

The press release explains that pet owners often rely on emergency and specialty clinics to provide care for their pet when general practice veterinarians are closed or when they need specialized services. The press release further asserts that there has been a growing trend towards consolidation in the veterinary clinic markets, particularly in the emergency and specialty services markets.

This regulation by the FTC is the second of those directed towards JAB to come this month, as the FTC also ordered JAB to divest clinics in California and Texas in order to go forward with its $1.1 billion acquisition of another clinic operator.