Australian grocer Coles Group said on Wednesday it is in discussions with U.S.-based private equity firm TPG for a potential acquisition of Greencross Pet Wellness Company, sending its shares to a two-week low.
TPG is likely aiming for about A$4 billion ($2.76 billion), the valuation it had sought for the pets and vets business in a potential float, the Australian Financial Review (AFR) had reported earlier in the day.
Coles, Australia’s No. 2 grocer, approached TPG almost a year ago, AFR reported, citing sources with knowledge of the matter.
TPG declined to comment when contacted by Reuters.
Coles, which was spun off by Wesfarmers in 2018 and is run by Leah Weckert, said it will only pursue the acquisition if it can generate strong shareholder returns and that talks remain incomplete with no certainty of a transaction proceeding.
Shares of the group slid as much as 7.8% to A$22.48 by 0230 GMT, marking their biggest intraday loss since February 27. The stock was also the top loser on the benchmark S&P/ASX 200 index.
