By Abigail Summerville
NEW YORK (Reuters) - Investment firm Pondera Holdings is exploring options for Whisker, including a sale of its controlling stake that could value the maker of self-cleaning cat litter boxes at close to $1 billion, according to people familiar with the matter.
A deal would likely lead to the recapitalization of Whisker, with new debt and equity refinancing its capital structure, said the sources, who requested anonymity as the discussions are confidential.
Whisker is working with investment banks Bank of America and Houlihan Lokey (NYSE:HLI) to evaluate its options, the sources said, cautioning that a deal is not guaranteed.
Pondera and Houlihan declined to comment. Bank of America did not immediately respond to requests for comment.
Private equity firms have been attracted to pet-care companies in recent years, as a surge in pet ownership during the pandemic drove up demand for pet accessories.
Earlier this year, Blackstone (NYSE:BX) agreed to take pet-care app Rover private in a $2.3 billion all-cash transaction. Last year, Apollo Global acquired a significant stake in retailer PetSmart.
Auburn Hills, Michigan-based Whisker was launched by Brad Baxter (NYSE:BAX), an engineer by background who inherited two cats and wanted to create an alternative to the traditional litter box. Baxter launched the Litter-Robot, an automatic, self-cleaning litter box, in his basement in 1999.
Litter-Robot currently has more than 1 million customers, according to its website. Whisker also makes an automatic pet feeder called Feeder-Robot and other cat accessories.
Chicago-based Pondera is a mid-market investment firm that backs several companies in the consumer, retail and animal-welfare industries. Its portfolio includes Avanti Equine Veterinary Partners, confectionary brand CandyCo and pet care firm Wag'n Tails.