Viper Equity Partners Says It's Time To Reopen Your Dental Practice. The Experts Agree: Just Do It!

PALM BEACH, Fla., May 20, 2020 /PRNewswire/ -- For Americans, one thing is certain: We have had our share of trials to overcome. We have been forced to adapt, change, and often evolve into what can feel like a whole new world.

Luckily, that is what makes this country so great. It is this discomfort that forces us to learn more about ourselves, reevaluate, and prevail.

The dental industry is no different. As the dental world goes back to work it is time to weigh in on what to expect for the doctors and their private equity partners. To that end, let us hear what some industry experts have to say.

For years, the dental support organization, or DSO, market has been a considerable part of many private equity companies' portfolios. This is because dental practices can be highly profitable and very adaptable, so joining forces is a natural fit. This industry is young and shows no signs of slowing its growth over the next several years. As we emerge from the haze, doctors will more than ever see the value in being part of an organization.

"I often get asked by doctors why they would want to be part of a DSO, and what the benefits are for that type of affiliation," states Greg Wappett, director of corporate development for 42 North Dental, a Northeast-based DSO.

"I tell them that the answer is different for everyone because the motivation to join a group is case-specific," Wappett continues. "Look at the situation we are coming out of now. It could not be more evident how beneficial it is to have a human resources, operations, clinical affairs/quality assurance and finance team behind you to navigate through this. The key is to ensure that there is a stable and healthy company that employees can return to and patients can be able to count on when things get back to normal. Being part of a DSO just makes that all easier."

As dentists and DSOs alike assess the past few months, it is easy to agree.

One thing that seems to be moving forward with velocity is the consummation of deals between dental practices and DSOs. In fact, in that regard, March and April have proven to be two of the busiest months in several years. Alabama-based High-Speed Alliance has orchestrated numerous practice sales for its clients over the last 18 months and currently has over a half dozen of their clients' practices under LOI, tracking to close.

"Our fear of buyers walking away from deals has gone unfounded. We even had new LOIs come across our desks this week," says the CEO of High-Speed Alliance and retired dentist Dr. Forrest Bryant. "Larger, more capitalized DSOs are becoming more aggressive, purchasing practices and smaller DSOs. We still think the valuations will stay high," he adds. This trend is being seen nationwide.

With prices holding in the market, there have been some adjustments in how deals are structured, which is a logical way to manage risk for sophisticated buyers. "We are seeing buyers incorporate additional earnout periods or increase the amount of purchase price subject to an earnout," reports Jonathan Eskow, managing partner at Eskow Law Group.

"The good news on a macro level is that for all the deals we are working on, valuations are holding steady so far and progress continues to be made on diligence and legal document flow with all tracing toward closing as planned. This is a very positive sign and a testament to the strength of, and general confidence in, this industry."

That said, dental does not stand alone. "At the end of the day, practice valuations are no different than any other type of market condition. The stock market goes up and it goes down, as does real estate," affirms Wappett. 

The main thing is to focus on returning to where we were 60 days ago. It is time to let March and April pass into the rearview mirror, and we must all get back to doing what we do. As for the dental consolidation market? "We look at the facts, the amount of deals we have under LOI heading to close, inventory of practices under contract and available for acquisition and DSO/buyer appetite. These areas are at all-time highs," states David C. Branch, principal at Viper Equity Partners, an M&A advisory and investment bank.

"There are zero indicators that the dental industry will dip or that there will be any long-term damage to PE firms or DSOs from this short-lived setback. What we are seeing are marquee practices and groups that now realize the true benefit of being part of a DSO coming to market—and coming in a big way," Branch adds.

All dentists and dental specialists should examine the DSO market and what it can mean for their future. Soon, DSO meetings, dental conferences, and educational seminars will be back in full swing, providing excellent opportunities to network and learn.

We would say that the market is back, but in truth, it never left. It is stronger today than ever and will continue for many years to come. "It is our advice to our dental clients that they be very aggressive with their growth plans both now and into 2021," recommends Dr. Bryant. One may say no greater words have been spoken. 

About Viper Equity Partners
As America’s Leading Transition Consultation Firm for the Medical Industry, working with dentists, plastic surgeons, dermatologists, cardiologists, and real estate. Viper Partners is America's leading M&A Advisory and Investment Bank in dentistry and aesthetics, representing Dental, Plastic Surgery, Cardiology, Real Estate, Loans, Financing, and Dermatology practice owners. Our exclusive relationships with private equity-funded Dental Support Organizations (DSOs) and Medical Support Organizations (MSOs) and our experienced team of M&A professionals are like no other in the healthcare marketplace. The Viper Team consults with every client, from contract to the closing table, with high integrity, efficiency, velocity, and a one-of-a-kind, value-added approach. Our 97% closing rate speaks for itself.

Contact Information:

For more information on how Viper Partners can assist with your business sale, contact Dave Branch or visit https://www.viperequitypartners.com/.

Dave Branch, Founder

Phone: (305) 988-5945

Email: dave@viperequitypartners.com

SOURCE Viper Equity Partners of Palm Beach LLC