Fresh cash injection to fuel further dental expansion

Scotland’s biggest independent dental group has received a further £25 million in financial backing to continue its expansion that has included some of the most popular practices across the country.

The fresh funding package for Clyde Munro, which has grown from seven to 54 practices since it was set up in 2015, has been provided by wealth management firm Investec.

It takes the total amount invested by the banking group to £55m, dating back to the first in a series of payments that began in 2018.

Led by founder and chief executive Jim Hall, Clyde Munro’s recent acquisitions have included Alloway Place Dental in Ayr, Bathgate Dental Spa in West Lothian, and Mearns Dental in Newton Mearns. Its network currently includes more than 200 dentists and 400 staff serving an estimated 460,000 patients.

“Investec has bought into our vision from the outset,” Mr Hall said. “This new cash injection affirms that ourselves, our shareholders and our bank have a huge commitment to, and belief in, the Scottish dental sector.

“It also gives us the firepower required to continue our amazing growth and deliver further on our clearly-stated ambition of becoming Scotland’s local dentist.”

READ MORE: Ayr practice joins rapidly-expanding dental group

The funding package includes an ESG (environmental, social and governance) ratchet that will reduce interest repayments on the funding as Clyde Munro achieves its sustainability performance targets.

It is only the second time Investec has deployed its ESG margin ratchet, which is based on Clyde Munro’s strategy that includes the creation of six designated “eco-champion” practices, along with a dedicated dental waste recycling programme.

The business also aims to rely fully on digital scanning and be “impression free in ‘23” to remove the need for multiple plastic trays and impression moulds.

Stephen White, head of origination in growth capital at Investec, said: “This funding is not only an investment in Clyde Munro, but a major boost for Scotland’s dental sector.

“We are particularly delighted with this transaction as the ESG ratchet supports our commitment to sustainable finance and are in no doubt that Clyde Munro will act as an exemplar for other firms to follow suit in practicing sustainable business.

READ MORE: Newton Mearns practice joins rapidly-expanding dental group

“Clyde Munro is a business with a clear vision and we are incredibly proud to further support it as it continues to invest in its dentists, patients and individual practices.”

Mr Hall added: “Our ESG strategy differentiates us and forms a core part of our business. The ESG margin ratchet will propel us to becoming net zero by 2030.”

Owned by its management team and London-based private equity group Synova Capital, Clyde Munro is now on the hunt for further practices to join the group.

All are bought out entirely but retain what is described as an “integrated role in the running and management of the practice” through an equivalent ownership scheme.

Clyde Munro became the first group to exceed 50 practices in Scotland in May of last year with the addition of Mearns Dental on the outskirts of Glasgow. Founded by Craig Taylor when he merged his Crookfur Dental Practice with Gordon Robertson’s Means Cross Dental Practice in 1992, Mearns Dental included three partners along with a 15-strong team operating out of the two practices.

READ MORE: Dental and aesthetics practice acquired by ‘country’s largest group’

Its latest deal came last month with the acquisition of long-standing Ayr practice Alloway Place Dental.

Founded in the 1950s with a team of 20, Alloway Place serves almost 10,000 patients. It was sold by husband-and-wife team James and Jennifer McCall, who had owned the practice since 2013.

Ms McCall has worked there since 2012 while her husband started as an associate in 2010. Both have stayed on as associates.

“We became dentists because of our love of looking after the community and providing treatments that improve health and happiness,” Ms McCall said at the time of the deal. “Running a practice is greatly challenging as the amount of regulation has grown, even prior to the pandemic.

“We’d been given recommendations and carried out lots of research.

“It’s clear to us that Clyde Munro will give us that centralised support to free us up to put our time and energy fully into treating our patients.”

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