Better Choice acquires Canadian specialty pharmacy, eyes veterinary market expansion

American pet health and wellness company Better Choice has announced it will acquire SRx Health Solutions for $125 million (€113M).

The “transformational acquisition” is expected to close in the last quarter of the year, creating a combined health and wellness company. SRx will own 85% of the combined company, while Better Choice will hold 15%.

“The goal of the transaction is to leverage the SRx expertise in pharma and pharma distribution and procurement to ultimately enter the veterinarian market,” Valter Pinto, Managing Director of Better Choice, tells GlobalPETS.

Once the deal closes, there are expected to be “immediate operational and growth synergies,” estimated to be over $1.7 million (€1.5M), to fuel further expansion.

In the first half of 2024, both companies generated total net revenue of approximately $95 million (€85.9M), which is expected to surpass $270 million (€244.2M) by the end of 2025.

Leveraging combined capabilities

SRx Health operates 35 specialty pharmacy locations, 40 health clinics, 4 clinical trial sites and 2 distribution facilities in Canada. Better Choice is known for its Halo pet food brand.

The combined entity will implement growth strategies and invest in “new verticals and geographies.”

SRx hit C$161.5 million ($119.1M/€107.8M) in revenue in 2023 and has shown steady income and cash flow growth.

Reshuffling appointments

SRx’s CEO, Adesh A. Vora, will become CEO of Better Choice, while its Chief Financial Officer (CFO), Dave Sohi, will become President.

Current Better Choice CEO Kent Cunningham will lead the Halo business unit, and Nina Martinez will remain CFO.

The combined company’s Board of Directors will include Vora, Cunningham, Michael Young, Lionel Conacher and David White.