Owners of a veterinary practice in Germany who want to sell will find an eager buyer in the veterinary group IVC Evidensia: „Are you interested in selling your practice or clinic to us?“ asks the British company on its German-language website. „A member of our team will contact you to arrange a suitable appointment for an initial discussion - followed by a non-binding valuation of your practice/clinic.“ Reassuringly, it adds that "you will be in good hands. As fellow vets, we understand that this is a sensitive time for you, and will treat the process with the utmost respect for you and your business.“

IVC Evidensia is owned by the Swedish private equity firm EQT, along with US private equity firm Silver Lake and the Swiss food giant Nestlé. The company is the largest player in Europe in the lucrative field of veterinary medicine for pets such as cats, dogs and hamsters. According to its own information, the IVC Group operates in 19 countries and has a network of over 2,300 veterinary clinics. In Germany, it is represented by more than 60 veterinary practices and clinics. An IPO is planned sooner or later.

Since the pandemic at the latest, when it became clear that more and more people were keeping pets, and making a constant financial commitment to them even in difficult times, corporations have been consolidating the small-scale landscape of veterinary practices into larger corporate groups. In some cases, there are local monopolies and prices are rising. The biggest players alongside IVC Evidensia are Veterinary Associates, owned by JAB Holding of the billionaire family Reimann, PetVet from the portfolio of private equity firm KKR, and London-listed CVS and Veterinary Health Group, which belongs to the snacks and pet foods company Mars. In Germany, Mars operates the veterinary chain under the name Anicura – as one of three market leaders.

According to the German Veterinary Association, investors have also been gradually buying veterinary clinics and larger veterinary practices in Germany since 2015 – particularly in the small animal sector, but also equine clinics and practices. „These investors are usually backed by private equity funds,“ states Chamber President Holger Vogel. „The resulting structures are known as practice chains or corporates.“ There is no official record of all current corporate locations in Germany.

A survey by „Tierärzte Atlas“ counted a total of around 450 locations of 16 different practice chains in August 2024. The data does not claim to be complete. Compared to the total number of around 10,500 veterinary practices and clinics, the figure is still low – less than 5%.

In other European countries, the corporate share is significantly higher: in the UK, it is over 60%. The antitrust authorities there are currently investigating the market power of these companies. In Germany, however, most of the 450 corporate locations fall into the group of „larger“ veterinary practices, veterinary clinics and animal health centres with a turnover of 1 million euros or more. The market share of corporates in terms of turnover is therefore significantly higher.

And the business is extremely profitable. According to rating agency S&P, IVC Evidensia's latest operating earnings before interest, taxes, depreciation and amortisation (Ebitda) were 556 million pounds. With a cash flow of around 1 billion pounds, earnings flow so steadily that investors accept a debt of more than seven times Ebitda. The rating is stable at „B“, and in January IVC Evidensia refinanced itself with a huge Term Loan B of 2.4 billion euros with institutional investors, at more favourable conditions than before. „We expect IVC Evidensia's credit metrics to continue to improve, mainly due to solid revenue growth and good cost efficiency over the next few years,“ comments London-based S&P analyst Carolina Coelho.

The high level of profitability could also have something to do with local monopolistic structures. This is why the German Federal Cartel Office was also involved in 2022 when IVC Evidensia wanted to take over Germany's largest veterinary clinic, in Hofheim near Frankfurt. In the end – after intensive investigations – the green light was given. Andreas Mundt, President of the Federal Cartel Office, said that "Evidensia is continuing to expand its strong position in the region, but pet owners will still have sufficient treatment alternatives in the greater Frankfurt area even after the takeover.“

Following a survey of over 50 competitors and discussions with business chambers and associations, the Federal Cartel Office was unable to identify any significant restriction of competition, it said at the time. Even though Evidensia already operates a veterinary clinic 20 kilometres away from the Hofheim veterinary clinic in Kalbach, there are sufficient alternatives in the region. In addition to the German market leader Anicura, there are other independent veterinary clinics and practices in Frankfurt and the surrounding area.

One of these is the veterinary practice Maja Firlé – here, too, investors have already knocked on the door in the past year, as practice manager Walter Firlé explains. However, the offer did not come from Evidensia or Anicura, but from Tierarzt Plus GmbH. With currently 95 veterinary practices, the Berlin-based company is also one of the largest operators of veterinary practices in Germany alongside Evidensia and Anicura. Tierarzt Plus is backed by the Berlin-based venture and private equity firm Econa AG and the financial investor Inflexion.

The investors are also actively approaching veterinarians in their search for new acquisitions. „The „representatives“ come to the practice and enquire about their interest in a takeover,“ says Firlé. The interested parties come well prepared and know in advance about the performance of a practice.

The Firlés have opted against the offer, which also has to do with the desire for personal freedom. However, the practice manager can certainly gain something from the development on the market. Yes, investors strive to maximise profits, says Firlé. However, „it doesn't always have to be a bad thing if a practice is run professionally. Not every vet is a good manager.“

There is also the issue of difficult staff recruitment and succession planning. The supply of specialists in the veterinary sector in Germany is „catastrophic“, says Firlé. This is also due to the fact that fewer and fewer vets want to become self-employed.

According to the Chamber of Veterinarians, interest in the profession in Germany is undimmed, and the number of practising veterinarians has risen by 54% between 2003 and 2023. However, the number of practice owners in private practice has been on a plateau for years and has been falling since 2019, with more and more veterinarians opting for salaried employment. „Since the majority of new entrants to the profession are women and the legal regulations on maternity protection and parental leave make family planning in an employment relationship much easier, this is understandable,“ says Veterinary Chamber President Vogel.

It is therefore likely to remain difficult for vets to ensure the continued existence of their practices themselves for the time being – and the interest of financially strong investors may simply come in handy for some veterinarians from a certain point in time. „When you've worked as a vet for half your life, you often run out of breath,“ says Firlé.