What is Your Veterinary Practice Worth in 2025?

The veterinary sector continues to be a dynamic space for mergers and acquisitions, with strong investor interest and robust deal activity particularly in the second half of 2024. In this blog, we'll be reviewing what trends will continue through 2025. If you have questions while reviewing this material, contact President and Veterinary Practice Advisor, Gary Behler at gary@evergreenforfounders.com. Gary has over 20 years of experience in the veterinary industry, having been involved with over 100 transactions over his career. He is in constant contact with buyers and can provide insight into what you could expect to receive if you are contemplating a sale. 

Key Drivers Fueling the Market 

1. Costs of Capital Becoming More Stable with Interest Rates Coming Down: With interest rates starting to decrease, the cost of capital utilizing debt financing for acquisitions has become more attractive for investors.  
2. Continued Interest from Private Equity (PE) Firms: PE firms remain highly active, seeing veterinary care as a recession-resilient sector with attractive growth prospects. These firms are drawn by stable cash flows, opportunities for scaling, and potential for value creation through better operational efficiencies. 
3. Increased Focus on Specialty and Emergency Services: With more pet owners seeking specialized care, practices that offer unique services such as dental, orthopedic, and oncology treatments have seen an uptick in interest. As a result, multi-specialty veterinary groups are commanding premium valuations in the M&A market. 

Market Trends and Insights 

• Tech-Enabled Practices Draw Higher Valuations: Veterinary practices with integrated telemedicine platforms, electronic medical records, and other tech-based solutions are considered particularly attractive. These capabilities not only streamline operations but also improve patient care and client communication, adding to the practice's overall value. 

• Market Valuations Continue to Trend in a Positive Direction: While not at the levels we had seen during the pandemic into 2021, we have seen a continued increase in valuations for hospitals in an attractive geography with updated facilities primed for growth. 

• Operational Consolidation as a Growth Strategy: Consolidation efforts remain strong, with many firms targeting multiple-practice acquisitions to expand their reach. Consolidators are looking to improve operational efficiencies through shared resources, standardized protocols, and centralized management structures. 

Spotlight on Consolidation: Larger Firms Acquiring Competitors 

A notable trend in 2024 is the increased consolidation among larger veterinary practice groups, with prominent firms like Southern Veterinary Partners (SVP) and Mission Veterinary Partners (MVP) actively pursuing acquisitions. In a recent announcement, Southern Veterinary Partners and Mission Veterinary Partners spoke of a potential merger, a move that signals an evolution in the sector's consolidation strategy. Previously, M&A activity in this space centered around larger firms acquiring individual practices, but the acquisition of an entire established chain represents a new scale of consolidation. 

This type of merger has a two-fold impact on the market: 

• Enhanced Market Reach and Efficiency Gains: Merging with a competitor of Mission’s scale enables Southern to immediately expand its geographic reach and client base. This allows the merged entity to leverage shared resources, standardize protocols, and reduce overhead across practices. 

• Creating Market Leaders and Intensified Competition: Large consolidations create more formidable veterinary care networks, making it challenging for smaller independent practices to compete. As these big players grow, they enjoy increased negotiating power with suppliers, access to better resources, stronger recruiting/retention teams and incentives, and stronger brand recognition. For investors, this concentrated market presence offers a more stable and potentially lucrative asset, while veterinary practitioners in these networks benefit from streamlined operations and shared resources. 

Looking Ahead: What to Expect in 2025 

The veterinary M&A market is likely to remain active, bolstered by steady demand and favorable macroeconomic factors. While high valuations may slow some acquisitions, the resilience and long-term growth potential of veterinary services will continue to attract strategic and financial investors alike. Practices with strong client loyalty, diversified service offerings, and tech-savvy operations are positioned to benefit most as the market evolves.

Veterinary hospitals, particularly General Practices, are now commonly valued at EBITDA multiples ranging from 8x to 12x. Smaller practices typically fall on the lower end of this range, while larger practices, those leveraging advanced technology, or those located in high-demand areas—along with ER/Specialty hospitals—often exceed 12x.

The increased consolidation of veterinary groups like SVP and MVP showcases a market that’s more competitive, efficient, and attractive to investors than ever before. For private equity and larger firms, the evolving landscape offers significant opportunities to scale, while pet owners can expect a greater level of care consistency and access to specialty services across wider geographic areas. The veterinary sector’s fundamentals make it a prime area for continued M&A activity in 2025 and beyond. 

Do you have specific questions about your veterinary practice? Are you contemplating a sale and unsure of where to start? We're here to help you. We're experienced in negotiating the highest possible offers for our clients, while managing the entire process to ensure closing success and reducing risk. Don't leave selling your veterinary practice to chance - let our team handle everything. You can reserve a call here on Gary's calendar or complete the form below. 

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