Battle of bids for Oasis heats up
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- Published: Wednesday, 09 January 2013 07:18
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The Sunday Telegraph understands the four – including CapVest and Bridgepoint Capital – are through to the second round of an auction process for Oasis, which is owned by Duke Street Capital. The four bidders, the third being Canada’s Omers Private Equity and the fourth as yet unknown, are understood to have made bids of £140m to £160m. Second-round bids are due by the end of January. The range is below the £200m to £250m thought likely when the sales process, being run by corporate finance house DC Advisory, began last June.
It is understood that during the first round, management indicated to potential bidders that Oasis now operates 200 dentist surgeries, down from 203, and generates adjusted profits – known in the private equity world as earnings before interest, tax, depreciation and amortisation (Ebitda) – of £19m annually. On that basis, the bids value the business on multiples of approximately 7 to 8.5 times earnings.
The lower-than-expected bids are understood to be related to concerns over issues facing the UK’s 10,000 dental practices, including expensive property leases, new NHS dental contracts and issues stemming from the Office of Fair Trading’s 2012 study into UK dentistry. It is believed a total of seven potential bidders received management presentations from Oasis, which is chaired by the former Southern Cross chairman, Bill Colvin. The seven included Bupa and GI Partners.
A spokesman for Oasis declined to comment on the bidding process.
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