Farnam Companies, Inc
Bucking the “experts” and delivering a record-breaking value.
Founded in 1948, Farnam Companies, Inc. was among America’s leading and most profitable manufacturers and marketers of premium, branded, over-the-counter (OTC) animal health care products, and among the best-known and most respected participants in the global animal health care industry. Farnam long dominated the horse health care products market, offered full lines of proprietary products and well-known brands for pets and small animals and had entered the professional veterinary and economic animal products markets with a number of exciting and innovative new products.
Key Atmospherics at the Time of the Transaction
Pet care superstore retailers were taking a larger percentage of consumer expenditures and exerting increasing pressure on supplier margins. Patents on key drugs and compounds were expiring. At the same time, competition and consolidation among manufacturers were increasing and the costs of new product development, new product launches and complying with federal and state regulatory schemes were skyrocketing. Acquisition opportunities were becoming fewer and much more expensive. Farnam’s shareholders were confident about the company’s future but the industry was experiencing such upheaval and uncertainty that they concluded that the time had come to sell the business.
The Etkin & Company Strategy
The marketing strategy that Etkin & Company designed and implemented for Farnam showcased Farnam’s well-known stable of loved brands, wide range of product offerings for multiple species, deep connection to consumers, long-standing, profitable relationships with channel partners, young, aggressive management team and long history of solid growth and profitability. The strategy resulted in the creation of a confidential, highly-competitive process that included many of the world’s largest pharmaceutical companies, most active strategic acquirers and best-capitalized and most aggressive financial acquirers.
The $340+ million transaction that Etkin & Company developed and concluded for Farnam’s shareholders with NASDAQ-listed Central Garden & Pet, Inc., resulted in a record-setting value that was almost twice the value a leading industry expert told the shareholders they would receive. The transaction reshaped the OTC animal health care products industry and created one of the world’s largest, strongest, fastest-growing and best-positioned manufacturers and marketers of OTC animal health care products for virtually all pet species.