ODC - Oil-Dri to Acquire Ultra Pet in Strategic Move to Compete in Rapidly Growing Crystal Cat Litter Market | Benzinga
CHICAGO, April 16, 2024 (GLOBE NEWSWIRE) -- Oil-Dri Corporation of America (NYSE:ODC) ("Oil-Dri"), a leading manufacturer of sorbent minerals including clay-based cat litter, announced today that it has entered into a definitive agreement to acquire privately-held Ultra Pet Company, Inc. ("Ultra Pet"), a prominent supplier of silica gel-based crystal cat litter.
Under the terms of the agreement, Oil-Dri will acquire Ultra Pet for $46 million in cash. Oil-Dri plans to finance this acquisition through a combination of cash-on-hand and its existing credit facilities. The board of directors of Oil-Dri and the managers of Ultra Pet's parent company have unanimously approved the transaction which is expected to close in Oil-Dri's fourth quarter of fiscal year 2024, after satisfaction of customary closing conditions. Oil-Dri expects this transaction to be immediately accretive to earnings following the completion of the transaction.
Ultra Pet, headquartered in Anderson, South Carolina, is a recognized innovator and pioneer within the alternative cat litter market with annual net sales of approximately $24 million. Ultra Pet introduced the original crystal cat litter, Litter Pearls, in the United States in 1998. Since then, Ultra Pet has expanded its product offerings and has an established presence in the crystal cat litter segment. Through multiple distribution channels such as e-commerce, pet specialty, and grocery, Ultra Pet has grown its business significantly over the past several years.
Since 2019, the crystal cat litter segment has experienced tremendous sales growth of 500%¹. This pending acquisition provides Oil-Dri the opportunity to become a significant player in this rapidly growing space within the cat litter market. Ultra Pet's line of branded and private label silica gel-based crystal cat litter offerings fit well with Oil-Dri's pet care product portfolio. Similar to Oil-Dri's clay-based lightweight branded and private label litter, Ultra Pet's crystal litter products are lightweight with superior odor control. Crystals are 99.9% dust free and absorb up to 90% of their weight in liquid. All of these benefits align well with Oil-Dri's strategic focus on growing the lightweight cat litter segment with both branded and premium private label high quality products sold at a fair price to consumers.
Daniel Jaffee, Oil-Dri's President and Chief Executive Officer, stated, "We are excited about this acquisition, as ...