Chewy acquired by PetSmart

In May 2017, the specialty retailer PetSmart completed the acquisition of all outstanding equity in digital pet platform Chewy, Inc. The buyout financing package combined $1.35 billion in 5.875% senior first lien notes and $650 million in 8.875% senior notes alongside an approximate $1.0 billion equity injection provided by PetSmart's existing shareholder group and available cash reserves. Initially announced on April 18, 2017, and closed on May 31, 2017, the transaction represents the largest e-commerce acquisition in the history of the pet care sector. At the time of the buyout, Chewy generated more than $500M–1bn in annual revenue and employed over 5,000 people across its headquarters in Dania Beach, Florida, its Boston office, and fulfillment facilities in Pennsylvania, Indiana, Texas, and Nevada, whereas PetSmart operated over 1,500 retail stores, more than 200 PetsHotel boarding locations, and employed 55,000 associates across North America. Chewy functions as an autonomous operating subsidiary led by co-founder and Chief Executive Officer Ryan Cohen, who joined PetSmart's board of directors. On this transaction, Citi and Barclays served as financial advisors and debt underwriters to PetSmart, with Simpson Thacher & Bartlett acting as legal counsel; Chewy was advised financially by Allen & Company and legally by Weil, Gotshal & Manges. This build-up enables PetSmart to scale its digital retail reach by combining its store presence with Chewy's automated e-commerce and subscription logistics infrastructure.