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Dunedin extracts 2.8x from dentist play

The sale of Practice Plan, which generated a 2.8x return, comes just a few weeks after Dunedin closed its Fund III on £300m, exceeding its £250m target.

UK-based Dunedin has sold Practice Plan, a support business for dental practices, to Wesleyan Assurance Society. 

The deal value was undisclosed, but the sale generated a 2.8x return for Dunedin, according to a statement. 

Practice Plan, based in Shropshire, offers marketing, business and consultancy support to dentists.

Dunedin invested in the business in 2005, using its maiden fund, a £54 million 2002-vintage. Following this deal, there is now just one company left in its portfolio. 

Under Dunedin’s ownership, Practice Plan has grown organically, as well as through acquisitions and internationalisation. The business completed two add-ons: Isoplan, a UK dental plan provider, and Medenta, a dental patient finance business. 

Additionally, Dunedin substantially beefed up the firm’s management team, hiring a new chairman, a managing director, a new financial director, a chief operating officer and an IT director. Since Dunedin invested in the business, membership fees collected have increased to more than £80 million ($124 million; €93 million) per annum. 

This latest divestment comes just a few weeks after Dunedin closed its third fund on £300 million.

The fund, which came to market in the third quarter of last year with a target of £250 million, held a £240 million first close in December 2012. The oversubscribed vehicle went on to surpass its target and close on £300 million, half as much again as the firm had raised for its previous £200 million fund in 2006. 

Dunedin’s third fund will invest in UK-based companies with an enterprise value of between £20 million and £75 million. The firm said today that in the last 12 months, its portfolio has recorded employment growth of 13 percent, turnover growth of 18 percent and EBITDA growth of 10 percent.