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Sentinel Capital is all smiles after sale of Northeast Dental

  • Firm sells Northeast Dental Management to Harvest-backed Dental Care Alliance
  • Sentinel purchased company in 2012 with capital from Fund IV
  • Sentinel promotes head of business development to partner

Sentinel Capital Partners has exited Northeast Dental Management in a sale to Harvest Partners-backed Dental Care Alliance for an undisclosed sum after more than doubling the company’s office base in less than four years, an executive at the New York firm said.

The deal comes fresh on the heels of a busy 2015 for Sentinel Capital, which marked its 20th anniversary in November, lined up nine portfolio company acquisitions and exits, beefed up its business development team and reached a deployment level of 36 percent for its $1.3 billion Sentinel Capital Partners V LP fund, which closed in 2013. Fund V’s first investment took place in 2014.

Paul Murphy, partner at Sentinel Capital, declined to provide a return multiple on Northeast Dental, but he said the firm closed 24 add-on deals for the company since it purchased the Paramus, New Jersey-based dental services specialist in 2012 with capital from Fund IV.

Sentinel Capital typically invests in platform companies with up to $65 million in EBITDA.

Moving quickly, Sentinel more than doubled the number of offices for Northeast Dental to 65, up from 29 when Sentinel purchased the company from DFW Capital. Northeast Dental expanded its existing presence in New Jersey, Pennsylvania, Virginia and New York and added locations in Maryland, Massachusetts and Connecticut for a footprint in seven states.

“The idea was to buy the platform, build out its infrastructure to handle further growth and to develop a systematic approach to identify, execute and integrate these add-ons,” Murphy said. “There are Baby Boomer dentists who want to retire and junior dentists coming out of dental school don’t necessarily want their own practices.”

Northeast Dental helps dentists focus on their craft while providing assistance with human resources, finance and accounting, marketing, purchasing supplies and equipment, working with insurance companies and regulators, he said.

Craig Abramowitz, CEO and founder of Northeast Dental, will remain with the company under Harvest Partners.

The deal marked Sentinel’s fourth platform company in the dental industry after Castle Dental, Metro Dentalcare and ReachOut Healthcare America .

“It’s a space that we know well and that we like a lot for consolidation,” said Murphy. He didn’t rule out the possibility of future deals in the “dynamic” sector.

Boost to deal sourcing

In a move to boost its deal sourcing, Sentinel promoted Luke Johnson, head of business development, to partner. Garrett Schires has also been promoted to vice president of business development after working as senior associate.

The firm now deploys a four-person development team to “make sure we see as many opportunities as possible out in the marketplace,” Murphy said.

Separately, Michael Fabian and Scott Perry have been promoted to partner.

Despite high deal prices in 2015, Sentinel bought Corporate Visions, Driven Performance Brands, Fazoli’s and Total Military Management, and made a further 18 add-ons. It also exited Hospice Advantage, IEP Technologies, North American Rescue, Spinrite and Vintage Parts.

Action Item: Reach Luke Johnson, head of business development, at johnson@sentinelpartners.com.

Photo courtesy of Shutterstock

Clarification: This story has been updated to clarify that Sentinel Capital Partners sold Northeast Dental Management to Harvest Partners-backed Dental Care Alliance; also to add that the firm’s Fund V made its first investment in 2014. The update also corrects the name Northeast Dental Management, which was written incorrectly in the prior version.