What's going on?

Friday was a furry good day for private equity firm EQT, which snapped up UK veterinary drugmaker Dechra.

What does this mean?

EQT�s been in talks to buy up Dechra since April, but the wooing process had its fair share of hairy moments. See, Dechra found itself in the doghouse when it issued a profit warning in the midst of negotiations. And that update � which certainly didn�t strengthen the drugmaker�s negotiating paw-sition � helped EQT bag a tidy 5% discount. Still, the deal ultimately came in at a cool $5.6 billion, a healthy 44% markup on Dechra�s value before the takeover whispers began. That pricey move will help expand EQT�s pet portfolio � which already includes everything from vet clinics to pet insurers and online retailers � putting the firm in a purr-fect position to capitalize on rising pet ownership rates.

Why should I care?

For markets: Low-cost London.
Private equity firms like EQT are always on the prowl for companies they can polish up and resell at a profit later, and this acquisition is a sign London-listed companies are maintaining their appeal. In fact, data shows that investment firms have splashed out almost $100 billion on UK public companies since 2018. That makes sense too: London-listed companies often trade at a discount compared to their US counterparts � and a lower entry price should make it easier to profit later on.�

The bigger picture: Healthy sector.
Rising interest rates and jumpy stock markets meant that dealmaking hit a ten-year low (setting aside the pandemic dip) in the first five months of this year. But healthcare�s been a bright spot, growing to make up a juicy 15% of all deals in the same period. And after Friday�s Dechra news, there could be more of that to come: after all, demand for healthcare is typically as steady as a surgeon�s hand.