Carlyle Group to acquire and merge IDH and ADP

Global alternative asset manager The Carlyle Group announced today that it signed a binding agreement to acquire Integrated Dental Holdings (IDH) and simultaneously merge it with Associated Dental Practices (ADP) in partnership with private equity firm Palamon Capital Partners (Palamon). Carlyle will hold the majority of the newly combined entity and Palamon will share joint governance whilst retaining a minority stake. BAML CP is fully exiting its stake in IDH.

IDH and ADP are the two leading providers of dental care in the UK, primarily focused on NHS dentistry, with close to 450 practices treating more than 3.5 million patients per year. Carlyle and Palamon will invest in the business to expand the number of practices, enhance the quality of patient care and grow NHS, private and specialist dental services. Furthermore, this investment will facilitate the company’s diversification into other primary care services and cosmetic treatments.

Richard Smith, CEO of IDH, who will lead the combined entity said “This investment will allow us to provide more services across more practices with a continued emphasis on high quality patient care in dentistry and potentially in other primary healthcare fields too. Furthermore, the merger with ADP is a particularly exciting and progressive step for both organizations in terms of career opportunities and development for the management, dentists and support staff. ”

“Carlyle and Palamon’s combined financial strength, extensive network, and track record in the management of healthcare companies are great assets to IDH and ADP,” said David Hillier, CEO of ADP, “Palamon’s contribution during their ownership has been integral to the success we have enjoyed and we are delighted that our partnership will continue.”

Eric Kump, Managing Director of Carlyle Europe Partners, commented “IDH and ADP are the UK’s market leaders in NHS dentistry with a committed focus on clinical excellence. A merger between businesses creates a wealth of opportunities for the new entity and we are delighted to have facilitated this unique transaction. We see long term growth potential in the dental services sector and are looking forward to working with the NHS to enhance patient access, value for services and to provide the highest standards of care”.

New equity for this transaction comes from Carlyle Europe Partners III (“CEP III”), a €5.4 billion buyout fund focused on investment opportunities in Europe. The fund made 5 investments in 2010 – a portfolio of Primondo Specialty Group’s retail businesses, B&B Hotel Group (hotel chain), Giannoni (manufacturer of stainless steel heat exchangers), NBTY (manufacturer of vitamins and nutritional supplements and parent company of Holland and Barratt) and Commscope (infrastructure solution provider for communications networks).