CADE conditionally clears merger of Petz and Cobasi

On 10 December, the Administrative Council for Economic Defense (CADE) cleared the merger of Petz and Cobasi, upon the signature of a merger control agreement. The package of remedies includes the divestiture of 26 shops in the Brazilian state of São Paulo.

The transaction involves two of the biggest groups of the retail market of pet products and services in Brazil. Petz and Cobasi operate in the sales of pet food, medication, hygiene, beauty, and accessories, among other pet products, in physical and online stores.

They also offer veterinary and grooming services, and sell plants, flowers, and convenience products. Petz also has industrial and wholesale operations through Petix and Zee.Dog brands.

Commissioner José Levi, rapporteur of the case, highlighted that the divestiture package provided for in the merger control agreement was decisive to mitigate the competition concerns identified in the merger review, ensuring rivalry in the market. “The competitive environment of the physical pet market, following the transaction under the terms of the merger control agreement, will be more competitive than the current scenario, representing a significant gain for the public interest, promotion of competition, and consumer protection,” he stated.

Mr Levi recalled a similar case reviewed by the Italian antitrust authority in 2022, also in the pet sector. At the time, the merger between Arcaplanet and Maxi Zoo chains, with more than 500 stores in the country, was approved subject to the adoption of measures to preserve competition, a decision aligned with the approach adopted by CADE.

Founded in 1985, Cobasi operates approximately 230 stores across several Brazilian states, with a greater number in the state of São Paulo and in the South and Southeast regions.

The Petz Group operates 257 brick-and-mortar stores, in addition to veterinary clinics, pet grooming services, franchised Zee.Dog units, and digital platforms. The company also operates in the manufacturing and sale of pet products and offers dog training and animal welfare services.

The cleared transaction will be implemented through the acquisition of Petz’s shares by Cobasi. Upon completion of the transaction, the current shareholders of Petz and Cobasi will hold 52.6% and 47.4% of the new company, respectively, with Petz becoming a wholly-owned subsidiary of Cobasi.

Access Case no. 08700.009264/2024-29.