Facilitating Growth Through Acquisition
Northeast Dental is a multi-unit dental service organization with affiliated clinics located in seven states along the “Amtrak Corridor” between Virginia and Massachusetts. NEDM provides administrative staffing, human resources, purchasing, financial, and IT support services to 65 locally-branded dental offices. NEDM’s affiliated offices provide high-quality dental care to nearly 200,000 patients annually and offer a full suite of best-in-class general and specialty dental services, including general dentistry, oral hygiene, oral surgery, periodontics, pedodontics, and orthodontics.
Background
NEDM was founded by Dr. Craig Abramowitz in 2003 when he acquired a single office in New Jersey from a large dental service organization. Dr. Abramowitz saw the opportunity to build a regional dental service organization in the Northeast, an area where the dental practice industry lagged the consolidation trends in other parts of the country. Dr. Abramowitz and his team acquired several multi-office practices in adjacent states, and by 2012, NEDM had grown to 29 affiliated offices in New Jersey, New York, Pennsylvania, and Virginia. At that point, Dr. Abramowitz’s private equity partner was ready to monetize its investment and gave him the opportunity to find a new partner to help continue NEDM’s growth. Dr. Abramowitz selected Sentinel because of our proven record in dental services and the strong relationship we had built with him and NEDM’s management team.
Opportunity
To partner with NEDM’s founding management team, accelerate growth through new affiliations, and establish NEDM as its region’s subconsolidator of choice
Accomplishments
Developed Acquisition Infrastructure: Sentinel helped management develop a business development function to build an acquisition pipeline, significantly enhancing NEDM’s capabilities to source, execute, and integrate acquisitions.
Growth Through Acquisition: Under Sentinel’s ownership, NEDM added 24 new affiliates—more than one new office per month at the time of our exit—while substantially growing its pipeline. NEDM increased its office density in existing states and expanded into three adjacent states.
Strengthened NEDM’s Office Support Capabilities: To serve a rapidly growing group of affiliated dental practices, Sentinel and management worked together to further develop NEDM’s back-office infrastructure and add talent in finance, purchasing, IT, and marketing. A new integrated IT system simplified reporting and streamlined data collection and analytics.
Outcome
In less than four years, NEDM grew its base of affiliated offices from 29 to 65, added three new adjacent states to its footprint, and more than doubled revenue and EBITDA. In 2016, having accomplished our investment objectives, we sold NEDM to strategic buyer Dental Care Alliance in a highly successful transaction for Sentinel and its management partners.
Case studies have been selected for illustrative purposes for management teams of midmarket companies considering a partnership with Sentinel and should not be considered an offer or solicitation of services or an actual or implied endorsement of Sentinel or any security, investment, or portfolio company. The portfolio companies highlighted are not representative of all current and prior investments of Sentinel. A list and description of investments since Sentinel’s inception is available on this website.