PE Firms Go in Big for Dental Deals

Buying dental practices has been a competitive sport for a few years now, especially among private equity firms. Eighteen deals for dental practices have been announced through July 20 this year (no prices, of course).

In all of 2017,  30 deals for dental practices were announced, with the buyers either private equity firms getting in on the action, or making add-on acquisitions.

Last year’s consolidations have become large platforms today. One example is Western Dental Group, a portfolio company of New Mountain Capital since 2012, which has been cobbling together a California base focused on pediatric and family dental practices.

In 2017, Western Dental added 14 Smile Wide offices in California, then eight offices of Children’s Dental Group in the state. Other add-ons were the 14 office-practice called Kids Dental Care in Orange County, and the single-site Choice Family Dentistry.

In the past two months of 2018, the company has picked up three SmileCare practices from Coastal Dental Services, in Fremont, Modesto and Stockton.

The only deal to disclose a price in 2017 was New MainStream Capital‘s $25 million purchase of CORDENTAL Group, a Cincinnati, Ohio -based dental support organization in March.

CORDENTAL went on to make two acquisitions of its own in August 2017. Rather than focus locally, those offices were in St. Louis, Missouri and Norfolk, Virginia. It’s announced three deals in 2018, so far, for small practices in Brentwood and Chattanooga, Tennessee, as well as Phildelphia, Pennsylvania.

Smile Brands Inc., a portfolio company of Gryphon Investors, has also been building a California platform. In 2o17, its four acqusitions brought 11 offices on board and gave it some brand names to build further. One was Johnson Family Dental in Santa Barbara, the other was A+ Dental in northern California.

Firms we’re seeing move into the space this year include Amulet Capital Partners, The Beekman Group, Cressey & Company. They join last year’s class, including BC Partners, Brentwood Associates, Gauge Capital, Linden Capital Partners, New MainStream Capital, Pouschine Cook Capital Management, Sentinel Capital PartnersSilver Oak Services Partners, Tailwind Capital and Tradewind Capital Group.

L Catterton exited its dental support organization, ClearChoice Holdings, LLC in November 2017, but was back in April 2018 buying the Canadian support organization, Dental Corporation Holdings Inc.

It makes for quite a large group photo. Smile, everyone!

 

 

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