Our dental team addresses key questions you may have when buying or selling a dental practice
Author: Molly Jones
Key contact: Ray Goodman
Buying or selling a dental practice involves a range of legal, financial, and operational considerations. This article addresses common questions about the process, from valuation and financing to legal agreements and timescales. Whether you are looking to sell your practice or purchase one, some of the points below may help answer your questions.
General process and timeline
How long does the entire process of buying/selling a dental practice typically take?
A typical transaction may take around six months, but it can vary. The timeline depends on factors such as the complexity of the transaction and the length of the due diligence process (which entails financial, compliance, employee and property checks to name a few). If there are any complications, such as delays in the Care Quality Commission (CQC) or Healthcare Inspectorate Wales (HIW) registration or financing issues, the transaction may take longer – good preparation prior to the transaction is key.
What will the process involve?
The main elements of the process from a corporate perspective include agreeing the heads of terms and due diligence, the negotiation of the sale agreement and supporting documents, and the disclosure process. From a property perspective, depending on what is required this could involve negotiating a new lease, an assignment of the lease that is already in place or a contract to purchase the freehold. There will also be due diligence conducted on the property element of the transaction.
Are there any significant complexities that can arise during the process?
Some of the potential complexities include information that was not disclosed by the other party during due diligence process, issues arising with employee contracts or TUPE regulations (which govern the transfer of staff on a business and asset purchase), and regulatory or compliance issues with the CQC, HIW or other governing bodies. This is why it is essential that you instruct specialist dental lawyers – and we are here to guide you and support you throughout the entire process.
Regulatory and compliance requirements
Is CQC/HIW registration required?
Yes, CQC/HIW registration is required to legally operate a dental practice in England and Wales. If you are purchasing a dental practice it is likely that it is already registered with the CQC/HIW and certain notifications and/or applications will need to be made. This is particularly important where the target dental practice operates an NHS contract, where a separate CQC/HIW registration may be required.
How long does CQC/HIW registration take?
The CQC/HIW registration process typically takes several months. This process involves submitting an application, providing details about your qualifications, business structure, and meeting all relevant health and safety standards. Delays can happen if there are issues with the application or if the practice does not meet CQC/HIW standards. On some occasions interviews may be carried out.
Financing the purchase
What financing options are available for purchasing a dental practice, and how do they affect the legal process?
Common financing options include bank loans, SIPP and personal savings. Some buyers may use a combination of financing methods, depending on their financial situation. If you plan to borrow money, you may need to work with a lender to secure a loan.
If you are considering buying or selling a dental practice, our expert team is here to guide you every step of the way. With in-depth knowledge and personalised support, we’ll ensure a seamless and successful transaction. Contact us today to discuss how we can assist you in achieving your goals.