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PetSmart online business, Chewy.com, files to go public

A static image of a Chewy.com promotional video.

Source: Chewy.com

Chewy.com, PetSmart's online pet product retailer, filed papers on Monday to prepare an initial public offering.

Chewy reported $ 3.5 billion in sales for fiscal year 2018, up from $ 2.1 billion in 2017. For the same period, it reported a net loss of $ 268 million, below a net loss of US $ 338 million.

Chewy did not say how much she hopes to increase the offer. Previous estimates have seen their valuation between $ 4.15 billion and $ 4.75 billion, according to S & P Global Ratings.

PetSmart acquired Chewy in 2017 for about $ 3 billion to add an online business to complement its store base as trends have changed online. But as the two lines of business diverged, PetSmart shifted part of its stake in Chewy into a move that laid the groundwork for a potential IPO.

The transfer of assets triggered a lawsuit against some of the company's creditors, which PetSmart settled earlier this month.

After the IPO, PetSmart will continue to be majority shareholder in Chewy. It will use IPO funds for working capital and general corporate purposes, according to the filing.

Chewy was founded in 2011 by Ryan Cohen and Michael Day. It distinguished itself from many of its competitors with customer service, which includes 24/7 access and online ordering in two days.

Since its sale to PetSmart, Chewy has expanded its own brand and launched "Chewy Pharmacy", an online pet pharmacy.

Cohen last year left the CEO position of the company. He was replaced by Sumit Singh, former chief operating officer of Chewy, who previously served as director of Amazon Fresh and worked for Dell.

Chewy, which will be listed under the symbol "CHWY", has hired Allen & Company, J.P. Morgan and Morgan Stanley to help lead its IPO.

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