The $29 is far above Petco's closing price yesterday of $19.45 on the Nasdaq. However, the company's 52-week high is $29.88. The transaction would make Petco, which operates about 800 stores across the country, a private company.
Leonard Green and Texas Pacific have both been avid retail buyers as of late. At the beginning of the year Leonard Green bought the 400-store Sports Authority for about $1.3 billion. It also made a bid for the Hollywood Video chain before competitor Movie Gallery stepped in an acquired the company last year. Texas Pacific was part of the joint venture that closed on the Neiman Marcus department-store chain last year for about $5 billion.
Petco posted net earnings of $11 million during its first quarter, down from $17.2 million during the same year-ago period. Same-store sales rose 2.2% for the quarter, which ended April 29, and net sales were $521 million, up 8.6%.
The Petco deal follows a string of deals by private-equity firms to acquire major retailers. Most recently, earlier this month, the Blackstone Group and Bain Capital announced an agreement to buy crafts retailer Michaels Stores and its 1,000 units for $6 billion.
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