Healthcare services 5 practices, $14M revenue · 20 months from review to completion
A five-practice dental group sold at 6.8× instead of 5.1×
The founder had an unsolicited offer and a sense it was low. Twenty months of preparation, normalised earnings and a competitive process moved the price by $4.3M.
Price as a multiple of EBITDA, first offer vs. completion
Before
5.1×
After
6.8×
A regional buyer approached the founder with an offer of 5.1 times reported EBITDA. It was the first offer the group had ever received, and the founder wanted to know whether to take it.
What we found
Reported EBITDA understated the business. The founder’s salary was above market, two practices paid rent to a company the founder owned at below-market rates, and a one-off equipment write-off sat in the last full year. Normalised, EBITDA was 18% higher than the figure the buyer had used — and the buyer had applied a discount for owner dependence the group could remove.
What we did
Over twenty months we moved clinical leadership to two associate dentists with equity, put the leases on arm’s-length terms, documented every add-back with evidence, and built a vendor data room. We then ran a short, competitive process with four buyers.
The result
The group sold at 6.8 times normalised EBITDA, $4.3M above the original offer, with a shorter earn-out and no retention clawback on the founder.