The consolidation of the dental industry has been growing steadily over the last 20 years. Today, 30% of americas dentists have joined one of the 600 DSOs making it the most active market in healthcare. Deal values based on EBITDA have risen above 11x for marquee single offices.
Old-school bloated DSOs have given way to progressive new players with partnership models that have structures favorable to the selling doctors. These groups offer the doctors higher front-end cash with equity rolls that really pay off at recaps or the doctors’ exit. Truly an amazing time for dentists and all dental specialists.
A driving force has been Florida-based Viper Equity Partners, a seasoned firm with expertise in deal structure, industry experience and everything healthcare. Leading Viper is David C. Branch, a private equity veteran and founder past CEO of one of the country’s largest radiology MSOs.
The rest of the team are all deep-rooted senior healthcare and finance executives. They credit their success to the depth of understanding of exactly what the job is, and it sets Viper apart from all others. Their reputation industry wide is they work diligently on task and time, produce real valuations, and support their clients and buyers from start to finish on every deal.
Viper works primarily in the oral surgery, general dentistry and orthodontics areas. They are highly proficient at roll ups where they take a group of similar offices and put them together in a non-integrated financial document presenting them to buyers as one company.
The goal is to achieve a higher deal value. Larger deals historically find comfort and success with Viper because of it connections with private equity firms and understanding of complicated deal structures necessary to get the seller exactly what they want. Multiples now in Q2 of this year are at historic highs but buyers are also more cautious than ever. To combat that, Viper now underwrites all its clients deals in-house, prices them with the client then takes them out to market. This keeps the seller in a strong position and aids the buyer in the decision-making process.
For practice owners with multiple locations, revenues over 10 million and aggressive growth expectations that are looking for help, Viper is the only choice. In many cases a private equity firm would be a key buyer to start a new platform based on a specific specialty. In others, a DSO would entertain a joint venture partnership with a seller. Merger opportunities with another like size seller and formation of a new DSO is also a strong option. The bottom line is education and experience are available with Viper.