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NASDAL Practice Goodwill Survey – corporate competition?


  Posted by: The Probe      25th July 2018

This week has seen the latest statistics from the NASDAL (The National Association of Specialist Dental Accountants and Lawyers) Practice Goodwill Survey released. The survey for the quarter ending 30th April 2018 shows a mixed picture across the country and a number of practices seeming to benefit from large corporate buyer competition.

The headline figure for deals has dropped slightly – an average goodwill value of 132 per cent of gross fees – 5 per cent down from the previous quarter. Average valuations are reasonably steady at 140 per cent of gross fees which is an increase of 4 per cent on the quarter ending 31st January 2018. NHS practices in particular still appear to be in huge demand with a significant number of sales in the quarter at considerably over 200 per cent of gross fees.

Alan Suggett, specialist dental accountant and partner in UNW LLP who compiles the goodwill survey, said, “A particular area of note in this survey is that certain practices that are larger and located in the ‘right place’ are gaining from competition between the larger corporate groups such as BUPA, Portman and Genesis as they compete for the sale. Small comfort if you are looking to sell in the ‘wrong place’!

As we have noted previously, geographical factors seem to be becoming increasingly important, and this links with a similar pattern in associate availability. Bank appetite to lend is still very strong although RBS are now effectively out of the market due to lack of appetite leading to very high interest rate pricing.”

The goodwill figures are collated from accountant and lawyer members of NASDAL on a quarterly basis in order to give a useful guide to the practice sales market. These figures relate to the quarter ending 30th April 2018.

NASDAL reminds all that as with any averages, these statistics should be treated as a guideline only.

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