$175m financing deal supports major US pet distribution merger

Gordon Brothers has provided a $175 million financing package to support Phillips Pet Food in its acquisition of Central Garden & Pet Co.’s pet distribution arm, Central Pet, in a deal set to create the largest pet distribution business in the United States.

The funding, structured as a unitranche asset-based lending facility featuring a RILO (Real Estate Inventory Loan Obligation) tranche, will not only support the acquisition but also provide additional flexibility and long-term capital to drive future growth and investment.

Phillips, which is backed by Axar Capital Management, will combine with Central Pet to form a major force in the US pet supply chain, aiming to deliver a comprehensive, one-stop solution for retailers and suppliers.

As part of the transaction, Gordon Brothers will act as integration agent, bringing its expertise in asset-backed finance, real estate optimisation and inventory management to support the merger. The firm is expected to play a key role in aligning operations across the combined business, including rationalising inventory and supporting the sale of non-core products.

“We’re proud to support Phillips’ acquisition of Central Pet and help accelerate its expansion efforts to create a powerhouse organisation in the pet distribution space,” he said.

Gordon Brothers will also serve as the exclusive real estate advisor to the newly combined company, undertaking a comprehensive review of its distribution and operational footprint. This will include identifying redundant facilities, restructuring leases and developing a more efficient, scalable real estate strategy to support long-term demand.

Al Williams, Co-Head of North America Real Estate Services at Gordon Brothers, said the groundwork for integration had already been laid during the acquisition process.

“We collaborated closely with the management team to establish a comprehensive real estate roadmap for the combined portfolio, allowing us to move directly into execution,” he said.

For Axar Capital Management, the transaction represents a significant step in scaling Phillips’ operations and strengthening its position in a growing market.

Grant Mitchell, Deputy Chief Investment Officer at Axar, praised Gordon Brothers’ role in the deal.

“Their team brought deep asset expertise and a highly collaborative, solutions-oriented approach. We particularly valued their flexibility and creativity in supporting the specific requirements of this transaction,” he said.

The financing structure includes Gordon Brothers’ proprietary RILO solution, which combines the flexibility of a revolving credit facility with the characteristics of longer-duration debt, enabling borrowers to access committed liquidity while navigating periods of transition or expansion.

The deal underscores the growing role of asset-based lending in complex acquisitions, particularly where operational integration and capital flexibility are critical to unlocking value.