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Private equity firm Hellman & Friedman LLC's bid to take over European online pet supplies platform Zooplus AG for roughly $3.20 billion potentially marks one of the 10 largest private equity buyout deals in the e-commerce sector since 2016.
The COVID-19 pandemic increased demand for pet products and drove up revenues for companies like Zooplus.Source: Thinkstock
Stay-at-home orders and travel restrictions led many people to seek out pets during the COVID-19 pandemic, increasing the demand for pet-related products and driving up revenues for companies like Zooplus. This likely contributed to the deal's relatively high valuation, which is not typical in the e-commerce sector, Scott Denne, senior research analyst at 451 Research, said in an interview with S&P Global Market Intelligence.
The proposed buyout is expected to help Zooplus gain an edge in the European pet supplies market, which has substantially shifted online in recent years and accelerated during the pandemic.
The Hellman-Zooplus deal is "an example of how e-commerce outcomes have not been evenly distributed in the pandemic," Denne said.
Certain categories made significant gains, such as online supermarket food delivery and pet-related supplies, while online travel platforms, for example, were negatively impacted for obvious...