MediEstates - Getting down to the bones of your business
Getting down to the bones of your business

Due diligence is a fact-finding process in which the vendor will undertake to obtain and provide detailed information about the dental practice.

It allows the buyer’s solicitor to drill down into the bare bones of the business to not just ensure it is a viable acquisition for their client, but also highlight any potential complications further along in the sale process.

Importance of a specialist solicitor
Once a practice is sold subject to contract and heads of terms, and an offer has been agreed, both sides’ solicitors become involved in the due diligence process. It is a lengthy, time-consuming and often frustrating process, and at this stage it is highly recommended that both vendor and buyer instruct specialist solicitors who understand the exact requirements of a dental practice purchase.

It starts with the buyer’s solicitor issuing a due diligence questionnaire to the vendor’s solicitor and the vendor must provide all the necessary information covering three main areas:

  • The business element of the practice
  • The financial side of the business
  • An in-depth analysis of the property itself

Equipment and compliance
The buyer will ask for an inventory of fixtures and fittings, details of ownership of assets and what is excluded from the sale. This includes any lease, servicing and maintenance contracts, and proof that all practice equipment is maintained in good working order.

For NHS practices, the buyer will want to see a copy of the NHS contract, recent pay and activity statements, and vital signs reports. This will show the buyer the value of the contract and whether the practice is underperforming or hitting its units of dental activity targets.

Regulatory information and staff
At least three years of certified accounts are required to assess turnover and forecasts. The vendor needs to supply copies of all staff contracts, working hours, rates of pay and vaccination histories, as well as disclosure of any complaints against staff members and how this has been dealt with. The same applies to any associates and locums, with copies of contracts, licence fee amounts and confirmation of self-employed status.


Working with professionals who deal with the due diligence process every day can help make everything run much more smoothly


Details of Care Quality Commission (CQC) inspection reports and registration details are essential, as well as details of the number of active patients.

The property
The buyer is entitled to ask for an energy performance certificate, fire risk assessment, asbestos report, legionella report, a copy of the building insurance policy, employer’s liability and public liability insurances, and any relevant planning permissions to ensure the property complies with various legal requirements.

Details of the planning permission is important as it also connects with the necessary CQC application. Both the buyer and the CQC will want to know when planning permission was granted, plus details of any existing planning permissions granted for potential expansion of the property.

It must be made clear how the building is owned and occupied, that it has D1 use planning consent to be a dental practice and who actually owns the building on a leasehold or freehold basis, plus any structural issues or ongoing repairs.

The result
Once the buyer’s solicitors have reviewed and completed the due diligence, and their credit has been approved, they draw up the sale purchase agreement. This sets out every detail of the transaction, including the information collated during due diligence and terms of the sale. This is just an overview of the amount of information that is required for due diligence, and can be a daunting process for both buyer and seller alike. For the vendor, it can often involve doing most of the investigative work in their spare time, especially if the proposed sale of the practice is not yet common knowledge among senior staff.

This is where an experienced dental practice broker can really help, advising vendors at the earliest opportunity about what will be required of them, while guiding them through the due diligence process and beyond. Working with professionals who deal with the due diligence process every day can help make everything run much more smoothly.

Posted by: Sue Vickers on

General Buyer Terms 

This agreement is in relation to MediEstates Limited whose registered office is at 1st Floor, Pacific House, Stanier Way, Wyvern Business Park, Derby, DE21 6BF acting for and on behalf of our clients ("the Vendors"); and yourself (Buyer's Name) in relation for an introduction to a prospective sale of a business as a going concern. By registering through this agreement I agree to all terms set out below:

  1. Definitions
    In this Agreement the following terms and phrases shall have the following meaning unless the context otherwise requires:

    Dental Practice business providing dental care. This business is under the MediEstates Ltd sale terms.
    Confidential Information
    Means the actual Vendors identity and all confidential information in respect of the Business, including, but not limited to, any ideas, business methods, prices, accounts, finance, marketing, research, development, manpower plans, processes, market opportunities, intentions, design rights, product information, customer lists or details, employees’ details, trade secrets, computer systems and software, and other matters connected with the products or services manufactured, marketed, provided or obtained by the Vendor, and information concerning the Vendor’s relationships with actual or potential clients or customers and the needs and requirements of such clients’ or customers’ operations.
  2. Obligation of Confidentiality
    The Prospective Purchaser agrees to treat as confidential, information supplied by or on behalf of the Vendor in connection with the sale of the Business.
  3. Exclusions
    The obligation of confidentiality set out in clause 2 does not apply to:
    1. any information received from a third party who was legally free at the time of disclosure to disclose it;
    2. any information which was already lawfully in the Prospective Purchaser’s possession prior to receiving it from MediEstates Ltd on behalf of the Vendor; and
    3. any information which is in its entirety already in the public domain.
  4. Duties of Prospective Purchaser
    1. The Prospective Purchaser shall take such a reasonable security measures to protect the Confidential Information and trade secrets.
    2. The Prospective Purchaser shall not, without the prior written consent of the Vendor, permit any of the Confidential Information:
      1. to be disclosed, other than in confidence to its legal or professional advisors;
      2. to be copied or reproduced;
      3. to be commercially exploited in any way;
      4. to be used for any purpose other than in connection with the prospective purchase of the Business;
      5. MediEstates is registered under the Data Protection Act 2018. Upon Signing this agreement you agree to follow the legal obligations of this act to protect the details of the information supplied to you, with it no to be passed outside of the control of you the prospective purchaser.
    3. The Prospective Purchaser agrees to keep a record of Confidential Information received.
    4. The Prospective Purchaser will return to MediEstates or the Vendor all documents containing Confidential Information and all copies of those documents on demand at any time which are in its possession or under its control, and for this purpose the term “documents” includes computer discs and all other materials capable of storing data and information. The Prospective Purchaser agrees that such documents remain the property of the MediEstates on behalf of the Vendor.
    5. The Prospective Purchaser must not jeopardise or re-direct the sale under any circumstances.
    6. The Prospective Purchaser must not contact the Local Area Team or CCG regarding any practice sale, by any means of media unless written permission is granted from the Vendor.
    7. To carry out own due diligence on practice purchases and accepts that any information MediEstates has supplied is information provided by the vendor and is not responsible for its accuracy or completeness.
  5. This Agreement
    The existence of this Agreement and its terms are confidential and neither MediEstates nor the Purchaser may disclose anything about this Agreement or its subject matter or implementation to any person other than in confidence to their legal or professional advisers.
  6. Duties of Prospective Purchaser
    When buying Dental practices, finance is normally needed. Our organisation operated over more than one of the MediHoldings brand, by completing this from you agree that the information can be shared to our other organisations to avoid the need to register independently and provide the best possible service.

    MediEstates will refer you to the specialist dental lending team and MediFinancial who will contact the necessary banks, whom have preferential healthcare lending rates in some cases, to ascertain which funding is available to you.
    By signing this agreement you do not have to use any of the banks MediFinancial contact, it is just another service which we provide.
  7. Deposit for Dental Practice
    If you are interested in putting forward a formal offer in for a practice, once the offer is accepted there will be a deposit required to secure the practice sale which is dependant of the practice size. This deposit is held in a client account and will be returned to the buyer on completion of the practice sale. You the buyer, will be required to sign a deposit schedule which will cover the buyer and the seller in the event that the practice sale does not proceed.
  8. Changes to this Agreement
    Any changes made to this agreement must be authorised and signed by one of MediEstates Ltd Directors.
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