FTC and 13 states sue to block Covetrus's purchase of MWI

Overview

Updated 1 hour ago

Covetrus agreed in March to buy MWI Veterinary Supply from Cencora for $3.5 billion. On November 13, the Federal Trade Commission and 13 state attorneys general sued in New York federal court to stop it.

Covetrus, MWI and Patterson Veterinary are the three national distributors that stock clinics with drugs, vaccines, gloves and surgical gear. The FTC says folding two of them together would leave clinics with fewer places to buy and push costs onto pet owners.

Why it matters

If the deal closes, U.S. veterinary clinics would have two national suppliers instead of three, weakening the price competition they rely on.

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Key Indicators

$3.5B

Purchase price for MWI

Cencora would receive $1.25 billion in cash, $800 million in preferred equity and a 34.3% common equity stake.

States joining the FTC suit

Arizona, Arkansas, California, Colorado, Maine, Michigan, Minnesota, Nebraska, New York, North Carolina, Ohio, Oregon and Texas.

50%+

Share of relevant markets the states say the combined company would control

The complaint names veterinary clinic distribution and distribution to large corporate accounts as the two markets.

National veterinary supply distributors

Covetrus, MWI and Patterson Veterinary are the three suppliers with nationwide reach.

60%

Rise in veterinary care costs since 2014

California's attorney general cited the increase when announcing the state's participation.

Covetrus distribution centers

The national warehouse network is central to the FTC's argument that smaller rivals cannot match the combined firm.

Voices

Curated perspectives — historical figures and your fellow readers.

People Involved

Daniel Guarnera

Director, Bureau of Competition, Federal Trade Commission

Leading the FTC's challenge to the acquisition

Letitia James

Attorney General of New York

Co-leading the multistate challenge

Rob Bonta

Attorney General of California

Participating in the multistate suit

Jeff Jackson

Attorney General of North Carolina

Participating in the multistate suit

Organizations Involved

Federal Trade Commission (FTC)

Federal Agency

Plaintiff seeking a permanent injunction

The federal agency that reviews mergers for anticompetitive effects and can ask a court to block them.

Covetrus Inc.

Animal-health distribution and software company

Acquirer; defending the deal in court

One of the three national distributors of veterinary supplies, owned by investment firms Clayton, Dubilier & Rice and TPG.

MWI Veterinary Supply Inc.

Veterinary products distributor

Target of the acquisition; owned by Cencora

A national veterinary distributor that the FTC describes as Covetrus's closest competitor.

Cencora Inc.

Pharmaceutical distribution company

Seller of MWI; would hold a stake in the combined company

The parent company of MWI, selling the unit for $3.5 billion in cash, preferred equity and retained stock.

Patterson Veterinary

Veterinary products distributor

The third national distributor, not a party to the deal

The remaining national competitor if Covetrus and MWI combine.

Clayton Dubilier & Rice

Private Equity Firm

Co-owner of Covetrus; named defendant

One of the two investment firms that own Covetrus and are named in the FTC complaint.

TPG

Private equity firm

Co-owner of Covetrus; named defendant

The second investment firm that owns Covetrus and is named in the complaint.

Timeline

February 2026 November 2026

4 events Latest: Yesterday

Tap a bar to jump to that date

November 2026
FTC and 13 states sue
Latest Legal

The FTC votes 2-0 to seek a permanent injunction; the states seek a preliminary injunction. The companies agree not to close before December 4, 2026.
Yesterday
May 2026
FTC issues second request
Investigation

Cencora discloses that the FTC asked for additional information and documents on the deal.
May 20th, 2026
March 2026
Covetrus agrees to buy MWI
Transaction

Covetrus signs an agreement to acquire MWI from Cencora for about $3.5 billion.
March 18th, 2026
February 2026
Deal terms announced
Transaction

The companies announce terms valuing MWI at $3.5 billion, with Cencora retaining a 34.3% stake.
February 2026

Scenarios

Judge blocks the deal and Covetrus walks away

Likely Resolves by Q2 2027

Discussed by: FTC complaint and the 13 state attorneys general

The court accepts the FTC's two-market definition and finds the combination presumptively unlawful. A preliminary injunction stops the deal, and the parties abandon it rather than fight a full trial. This is the outcome the complaint is built for: the states say Covetrus would control more than half of both markets.

Covetrus wins in court and closes the purchase

Unlikely Resolves by Q2 2027

Discussed by: Covetrus and its owners

Covetrus argues the FTC's market is too narrow, pointing to manufacturer-direct sales and online marketplaces that let clinics compare prices across dozens of distributors. If a judge accepts that framing, the government's case collapses and the deal closes. The company has said it is prepared to defend the transaction in court.

Settlement lets the deal close with a divestiture

Possible Resolves by End of 2027

Discussed by: Antitrust practitioners watching the case

Rather than litigate to a verdict, the parties negotiate a consent order. Covetrus sells a distribution center, a customer contract book or a business line to a rival, and the FTC drops its objection. The states would have to sign off or continue on their own, which they have shown they are willing to do.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

February-June 2015

Sysco and US Foods (2015)

The FTC sued to block Sysco's purchase of US Foods, arguing the two were the main broadline distributors serving large national restaurant chains. A federal judge agreed that the relevant market was defined by customer type, not by all food buyers, and blocked the deal.

Then

Sysco and US Foods called off the merger.

Now

The case became a template for defining distribution markets around the customers who have the fewest alternatives.

Why this matters now

The Covetrus complaint uses the same approach, splitting veterinary clinic distribution from distribution to large corporate practice groups.

February-May 2016

Staples and Office Depot (2016)

Staples tried again to buy Office Depot, after an earlier attempt in 1997 had been allowed. The FTC challenged the 2015 deal, and a judge blocked it in May 2016 after accepting the agency's market of office supplies sold to large business customers.

Then

The companies terminated the merger.

Now

The ruling reinforced that a merger can be stopped even when retail customers have many options, if large institutional buyers do not.

Why this matters now

Covetrus makes a similar argument that clinics can shop online. The FTC answers that large corporate practice groups still depend on a national distributor.

February-December 2024

Kroger and Albertsons (2024)

The FTC and a group of state attorneys general sued to block the grocery merger. Federal judges in Oregon and Washington blocked it in December 2024, and Albertsons terminated the deal and sued Kroger.

Then

The merger collapsed and the two chains went to court against each other.

Now

The case showed that a coalition of state attorneys general can carry an antitrust challenge alongside the FTC.

Why this matters now

Thirteen states joined the Covetrus suit, and they are seeking their own preliminary injunction rather than relying only on the federal agency.