Veterinary Mergers & Acquisitions – Market Update First Half 2025

The U.S. veterinary acquisition market demonstrated continued resilience in the first half of 2025, despite evolving economic conditions, shifting buyer behavior, and a modest decline
in patient visits. Below is an overview of key trends Monarch Practice Transitions has been seeing in our market thus far in 2025 shaping the veterinary transaction landscape:

Veterinary Market Overview

Valuations & Deal Activity – H1 2025

Valuation multiples for veterinary practices have stabilized, typically ranging from 9x to 12x EBITDA (cash flow). However high performing practices in high-demand markets are still commanding premium multiples as high as 15x, especially when owners choose a trusted advisory team to represent them in the market.

So yes, it is still a seller’s market though buyers are more cautious than they were in the peak of 2021 due to the rise in interest rates. The higher cost of money has been the primary motivation behind the trend of more complicated deal structures.

Buyer Dynamics

Private Equity (PE) Groups
PE interest remains strong, but buyers are becoming more selective, with a sharp focus on profitability, scalability, and staffing stability. Many groups set aside capital in their offers to assist in retention of associates and key employees with some offering equity at the clinic level (Joint Venture Equity) and/or in the parent organization (Topco Equity).

Practices located in regions with favorable recruiting conditions are receiving the most interest especially those with opportunities for margin improvement with cost of goods (COGS).

Due diligence processes have become more intensive, leading to longer timelines post-Letter of Intent (LOI), as groups dig deeper into financial performance, staff retention, and growth potential. These extended timelines may overwhelm sellers as they get closer to finalizing a transaction. Having a team of advisors behind hospital owners during this stage relieves much of the stress and secures the original offer parameters through closing.

Evolving Deal Structures: Shifting Away From Upfront Cash

Veterinary Merger & Acquisition (M&A) deal structures have grown increasingly complex in 2025, with a notable shift away from the straightforward high percent of cash at closing with remaining percent in the form of equity toward more performance-based arrangements. The two types of equity offered remain either the minority ownership in the selling clinic (Joint Venture Equity) or stock in all the clinics owned by the parent company (TopCo Equity) or a combination of both. More often other components such as interest-bearing seller notes and growth-based earn outs are included in the transactions.

This evolving approach reflects a broader shift in M&A strategy. Buyers are working to mitigate downside risk by tying a significant portion of deal value to post-closing performance. To unlock the full value of the transaction, sellers may need to maintain current EBITDA levels or demonstrate incremental growth in revenue and profitability over time.

With invoice and revenue growth proving difficult in the first half of 2025, these more nuanced structures are also helping to bridge valuation gaps, align incentives, and ensure a smoother transition during ownership change. For sellers, however, this increased complexity is making it more challenging than ever for veterinary hospital owners to navigate a corporate sale independently.

Consolidation Continues to Reshape the Landscape

Consolidation remains a dominant force in 2025, exemplified by high-profile mergers such as the late-2024 combination of Southern Veterinary Partners and Mission Veterinary Partners. These transactions reflect a strategic push toward greater operational leverage, centralized service models, and scalable technology infrastructure.

Following many months of internal debate and brand development, the newly merged entity ultimately chose the name Mission Pet Health. The decision came after an extended naming contest and extensive focus group research, which indicated that the name would resonate strongly with consumers and investors—particularly in the context of a potential IPO.

At the same time, there appears to be an invisible race among the largest veterinary consolidators to see who will go public first. Whether it’s Mission Pet Health, Vetcor, NVA, Thrive or one of the other major players who are all actively positioning themselves for public markets—each seeking to capture market leadership and investor confidence.

Trends in Client Visits

Client visit volumes have largely normalized following the post-pandemic surge, with the first half of 2025 showing low single-digit growth across most markets. Several key dynamics are shaping current visit trends:

• Preventive care and wellness plans continue to drive consistent, repeat visits.
• Urban and suburban practices report steadier traffic levels, while rural areas experience more variability in visit patterns.
• Price sensitivity is increasing, with many clients delaying or deferring non-urgent services. However, this makes thoughtful, transparent pricing more important than ever. Aligning annual fee increases with staff wage growth and clearly communicating the value behind those increases can improve acceptance. When staff members see that price changes are tied to team investment, they are better equipped to have smoother conversation about overall service quality.
• Practices utilizing flexible scheduling, client communication tools (e.g., text/email reminders), and loyalty or rewards programs are seeing stronger client retention and sustained visit volume.

This evolving focus on value-conscious pet ownership is also influencing buyer behavior. Acquirers are putting greater weight on client retention metrics, service mix, and overall visit consistency when evaluating potential acquisitions.

Outlook for the Remainder of 2025

The second half of 2025 is expected to bring steady and strategic acquisition activity across the veterinary sector. While the white-hot M&A environment of previous years has cooled slightly, demand for high-quality practices remains strong, particularly those with solid financials, opportunity for continued growth, engaged teams, and loyal client bases.

Corporate buyers are increasingly targeting veterinary hospitals in attractive, high-growth markets where recruiting veterinarians is less of a challenge. In these areas, practices with four to five full-time associates and over $500K in EBITDA are commanding the highest valuation multiples.

By contrast, smaller clinics with fewer than 2.5 veterinarians are facing a more competitive and selective buyer landscape. While still marketable, these practices may struggle to generate interest from multiple buyers or achieve the same level of valuation as their larger counterparts.

Overall, the market remains favorable for sellers who are well-positioned—but the bar has risen. Buyers are focused on long-term growth potential, team stability, and operational scalability, particularly in markets where demographic trends and pet ownership continue to support expansion.

Monarch Practice Transitions Final Thoughts

In today’s increasingly complex market, it’s more important than ever for veterinary hospital owners to fully understand their options. Whether you are planning for a future sale with a calculation of profitability or considering a sale in the coming months, having a team of experienced advisors by your side with deep industry knowledge, and a genuine commitment to achieving the best outcome for you and your team is vital. Maximizing the financial value of your hospital is a natural result of a process handled with care and integrity.