Analysis
As of November 14, 2026, the $3.5 billion merger of Covetrus and MWI Veterinary Supply faces a federal court fight. On November 13 the Federal Trade Commission sued in the U.S. District Court for the Southern District of New York to block Covetrus from buying MWI from its parent, Cencora, according to the FTC's announcement. The commission voted 2-0 to seek a permanent injunction, and the FTC lists 13 states joining the complaint: Arizona, Arkansas, California, Colorado, Maine, Michigan, Minnesota, Nebraska, New York, North Carolina, Ohio, Oregon and Texas. Bloomberg Law counted 12 states in its report.
The FTC named Covetrus's private equity owners, Clayton, Dubilier & Rice and TPG, as defendants alongside the company. That makes this a test of a large buyout exit as well as a merger case: the deal was built to merge a PE-owned distributor with a unit of a public drug wholesaler.
What Covetrus and MWI do
Covetrus, headquartered in Portland, Maine, calls itself "the first tech-enabled veterinary-practice improvement company" on its about page. It sells software it calls the Covetrus Platform alongside product distribution. According to the FTC, both Covetrus and MWI supply veterinarians with pharmaceuticals, vaccines, gloves, gauze, syringes, surgical supplies and thousands of other items, to customers ranging from single-vet practices to corporate accounts with hundreds of clinics. Both run national distribution networks and offer discounts and rebates that the FTC says smaller rivals cannot match.
“The agency argues the merger is presumptively unlawful under current case law and the 2023 FTC-DOJ merger guidelines.”
How the $3.5 billion Covetrus-MWI deal was structured
The deal was announced on February 18, 2026. Per the Covetrus announcement, it values MWI at an enterprise value of $3.5 billion, paid to Cencora in three parts at closing:
- Cash -- $1.25 billion upfront
- Preferred equity -- $800 million
- Common equity -- $1.45 billion in the combined company, a non-controlling 34.3% stake
Cencora would have kept a large minority stake in a bigger business rather than fully exiting its animal health unit.
Value Add VC data
- Oct 2022, take-private -- Covetrus acquired by funds affiliated with Clayton, Dubilier & Rice and TPG Capital; price not stated on the filing we opened (SEC)
- Feb 2026, merger agreement -- MWI at $3.5B enterprise value: $1.25B cash, $800M preferred and $1.45B common equity to Cencora (Covetrus)
No prior Covetrus valuation that we could verify this run gives a markup comparison.
Why the FTC says the Covetrus deal is illegal
The complaint says Covetrus and MWI compete head-to-head, and that Covetrus answered MWI's aggressive pricing with price cuts and rebates through its VetSuite program. The FTC says Vetcove, an online price-comparison platform for vets, has intensified that rivalry into what the complaint calls an all-out price war. The agency argues the merger is presumptively unlawful under current case law and the 2023 FTC-DOJ merger guidelines. "Covetrus wants to eliminate its closest competitor rather than compete for veterinary clinic customers," said Daniel Guarnera, director of the FTC's Bureau of Competition. California Attorney General Rob Bonta's office called the two companies "the nation's two largest veterinary supply distributors" and cited veterinary care costs up roughly 60% since 2014.
Covetrus says it will fight the FTC in court
The case is not settled. Covetrus said in a statement that the FTC relies on an outdated view of the market, pointing to manufacturers that sell directly to clinics and to online marketplaces that it says more than 60% of U.S. practices use, giving them access to 40+ distributors. The company said it is "fully prepared to defend them in court." The risk for the owners is time: a litigated injunction case can stretch for months, and the deal's equity-heavy structure means Cencora's payout depends on a combined company that the government is trying to stop.
The ruling will matter beyond pet care. The FTC and the California attorney general describe Covetrus and MWI as the two largest US veterinary supply distributors, and the case shows U.S. enforcers are still challenging PE-linked consolidation in concentrated distribution markets. It is the second large deal block Pulse has covered this month, after China blocked SoftBank's $5.4 billion ABB Robotics purchase. If the court sides with the FTC, CD&R and TPG will need a different exit for Covetrus than a merger with its closest rival.
