The Administrative Council for Economic Defense (Cade) approved this Wednesday (10), with restrictions, the merger between pet product stores Petz and Cobasi. The decision will give rise to the largest network of products and services for pets in the country and one of the largest in Latin America.
For the operation to be completed, the companies will have to sell 26 stores in the state of São Paulo, the majority in the capital of São Paulo. According to relevant facts disclosed by the two companies, the units to be sold represent around 3.3% of the combined company’s revenue in the last 12 months. Together, the two chains currently have 515 stores — 264 from Petz and 251 from Cobasi.
Restriction
The case’s rapporteur, counselor José Levi Mello do Amaral, stated that the concentrated sale of stores in São Paulo allows for a “competitive reinforcement” in the area most sensitive to concentration. The approved agreement also includes behavioral remedies, such as limits on exclusivity clauses, which have not been publicly detailed.
The only one to partially disagree with the rapporteur’s vote, councilor Camila Cabral Pires Alves said she was unsure about the choice of stores recommended for sale. In her vote, she warned that “even after the remedy, we will continue to have a relevant number of markets with problems”.
Cade’s president, Gustavo Augusto Freitas de Lima, highlighted that the robustness of the agreement is related to the interest of potential buyers — including Petlove, which formally expressed itself in the process. “Whether it will work or not is what we will measure and monitor,” he said.
Resistance from competitors
Rival Petlove was the main agent opposing the merger. The company, which operates mainly in e-commerce, but has physical stores in the South and Southeast, told Cade that the Petz–Cobasi combination would create a group “30 times larger than third place” in the sector and would represent harm to competition.
For Petlove, the sale of up to 28 stores would be a “clearly ineffective” remedy. The council, however, rejected the argument, stating that the package of divestment and behavioral commitments is sufficient.
In their defense in the case, Petz and Cobasi argued that competition must be analyzed also considering the digital environment, given that consumers compare prices between physical and online stores.
R$7 billion giant
With the merger, the new company will have annual revenue of around R$7 billion and will account for approximately 40% of the Brazilian pet market, which generates R$80 billion annually, according to data presented to Cade. The cost savings generated by synergies should reach R$330 million.
Under the corporate agreement, Cobasi shareholders will hold 47.4% of the new company, while Petz shareholders will have 52.6% of the stake and will also receive R$400 million, of which R$130 million via dividends (portion of profits distributed to shareholders).
Operation history
The merger had been approved without restrictions by Cade’s General Superintendence in June, but the decision was reviewed following an appeal by Petlove. The municipality’s economic studies directorate warned that, without medicines, the operation could raise prices by up to 15% in markets where Petz and Cobasi are leaders.
During the trial, counselor Carlos Jacques Vieira Gomes demanded clear and isonomic rules for the sale of stores, if there is more than one interested buyer.
Company structure
Founded in 2002, Petz has 7,000 employees and 264 stores in 23 states and the Federal District. With net revenue of R$3.3 billion in 2024, the company also operates 112 clinics and 15 animal hospitals. The company also operates the brands Seres, Adote Petz, Cansei de Ser Gato, Cão Cidadão, Zee.Dog, among others.
Created in 1985, Cobasi also has 7,000 employees and operates 251 stores in 94 cities. Last year, the company had revenues of R$3.2 billion. In addition to the Cobasi brand, the company operates the Mundo Pet and Pet Anjo brands.
Surveillance promise
In the decision, Cade informed that it will remain vigilant and closely monitor compliance with requirements and the impact of the merger on prices, product diversity and the entry of new competitors.
With approval, Petz and Cobasi now operate more than 480 stores in almost 20 states, in addition to digital platforms and veterinary services — consolidating the largest pet retail structure in the country.
