Acquisition of The Vet Practice
The total consideration for the Acquisition is $8.3 million, to be paid as $7.1 million in cash consideration and $1.2 million in Apiam shares.
Apiam's accelerated growth strategy to deliver $300 million revenue by FY24 remains on-track with the acquisition of The Vet Practice expected to deliver further organic growth following integration into the Apiam network.
The Vet Practice is located in the fast-growth peri-urban region of Whittlesea, on the outer northern suburbs of Melbourne. In recent years the City of Whittlesea has been one of the fastest growing municipalities in Australia and it is forecast to continue to grow rapidly - by 55.9% between 2022 and 2041.
Apiam's Managing Director, Dr Chris Richards said "the acquisition of The Vet Practice aligns with our strategy to enter regional veterinary markets where rapid population growth is driving strong increases in local animal numbers. The fact that The Vet Practice is also a leading companion animal clinic with a full-service offering means its services can be leveraged across our adjacent clinic network".
"Apiam continues to deliver strong organic growth across our companion animal services and it is acquisitions such as The Vet Practice that are expected to contribute to our accelerated growth strategy to achieve $300 million in revenue by FY24 and deliver increased operating margins."
The acquisition of The Vet Practice is expected to add ~$7.9 million in revenue and ~$1.33 million in normalised EBITDA to Apiam on a FY22 proforma basis.
Apiam has previously reported as part of its strategy to double revenue by FY24 that it is targeting reported revenue in excess of $150 million in FY22. Assuming a full-year contribution from The Vet Practice, Apiam's proforma FY22 revenue would increase to approximately $178 million.
Overview of The Vet Practice
The Vet Practice is a full-service companion animal veterinary clinic, that operates an animal hospital and canine rehabilitation centre from its Whittlesea premises. Services offered include regenerative medicine, hyperbaric medicine, arthroscopy, hydrotherapy and endoscopy as well as general pet healthcare.
The Vet Practice is owned by two veterinarian partners employing 48 staff including 12 veterinarians and 20 veterinary nurses.
Key Acquisition terms
Settlement of the Acquisition is expected to occur on 1 July 2022, in conjunction with Apiam's settlement of Victorian Equine Group (as announced to the ASX on 19 May 2022).
Shares issued to the vendors of The Vet Practice will be subject to a minimum escrow period of 12- months, with 50% subject to an escrow period of 24-months. Key personnel have entered into 3-year employment agreements with Apiam and are committed to leading the future growth of the business.
About Apiam Animal Health Limited
Apiam Animal Health Limited (ASX:AHX) is comprised of Australia's leading Production Animal and Mixed Animal veterinary practices. Apiam Animal Health incorporates over 150 highly experienced, industry leading veterinarians with expertise across the pig, dairy, feedlot, sheep, poultry, equine, and companion animal sectors, supported by an experienced administration, nursing, technical services and ancillary team. Apiam Animal Health is fully vertically integrated, including having veterinary wholesale, diagnostics laboratories, custom vaccines, logistics, and other ancillary services.
Apiam Animal Health Limited