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Dental One Acquired by MSD Capital and North Peak Capital

Wednesday, October 8, 2008 General News J E 4
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- Dental One to Share Best Practices and Vendor Relationships with Dental Care Partners, Also Owned by MSD and North Peak -



DALLAS, Oct. 7 /PRNewswire/ -- Dental One, Inc. today announced that it has been acquired by an affiliate of MSD Capital, L.P. and North Peak Capital LLC. Financial terms of the transaction were not disclosed.



Dental One is a dental practice management company affiliated with approximately 60 dental offices in the Dallas/Fort Worth, Houston, San Antonio, Phoenix, Denver and Salt Lake City metropolitan markets. Dental One was acquired by MSD Capital and North Peak from SSM Ventures and ABN Amro.



In describing why this transaction was good for the company, R. Kirk Huntsman, Dental One's founder and Chief Executive Officer, said, "Our investors and management team have worked closely over the past 10 years to build an incredible company. Our very strong performance over the past few years presented us with an opportunity to give our former investors a profitable exit. The company is poised for more dramatic growth, which our new investors can help us capture."



The acquisition of Dental One was not the first acquisition by MSD Capital and North Peak in the dental practice management space. In early 2007, they acquired Dental Care Partners, Inc. ("DCP"), a dental practice management firm based in Cleveland, Ohio. DCP operates approximately 90 practices in 17 major metropolitan markets in the Midwest and Southeast under the "DentalWorks" brand. DCP is widely viewed as a pioneer in developing unique equity-based business models for ownership and collaboration between the dentists and the services company.



The investors plan to operate DCP and Dental One separately, while sharing best practices and key vendor relationships.



"I have known and respected Kirk and his team for many years, and am excited to work in partnership with them," said Doug Brown, DCP's CEO.



Dr. Peter Grumbos, Chief Clinical Officer of Dental One, sees this as a perfect opportunity to further enhance the strong focus on clinical excellence within both organizations. "As Dental One and DCP share best practices going forward, we will pay special attention to areas where we can distinguish our organizations for their clinical excellence and exceptional patient care."



According to Michael Kahan, Managing Partner at North Peak, there were several things about this particular company that he and his partners found attractive. "Dental One has continued to perform well in this difficult economic environment. They have a proven business model overseen by a seasoned management team. The geographic footprints of our two companies are complementary, and Dental One provides us with instant access into high growth southwestern and western markets. This acquisition serves to enhance our existing DCP platform, and, through sharing of best practices, the two companies will continue to be leaders in the dental practice management industry."



"The Dental One acquisition augments our overall expansion plans in the dental management services space, as both companies have developed a proven, de novo practice strategy that is the centerpiece of our growth plans," said Eric Rosen, head of Private Equity at MSD Capital.



About Dental One, Inc.

Dental One Inc. provides a wide range of business services to its affiliated dental practices. Among the services provided by Dental One are administrative functions, including accounting, human resources, marketing and finance; recruitment of professional, administrative and support personnel in the practices; and equipment and facility leasing. In 2007, the company generated annual revenue of approximately $55 million. Dental One was founded in 1995 by Dallas businessman R. Kirk Huntsman and several partners. Additional information on the company is available at www.dental-one.com.



About MSD Capital, L.P.

MSD Capital, L.P. was formed in 1998 to exclusively manage the capital of Michael S. Dell and his family. The firm currently manages in excess of $12 billion in assets and is primarily focused on traditional private equity, real estate and publicly-traded securities. In each area, the firm's objective is to build an investment portfolio focused on maximizing long-term capital appreciation. MSD Capital's Private Equity group partners with outstanding owners and managers who can benefit from its strategic resources and flexible, permanent capital base. The group participates at various levels within the capital structure in both control and minority investments across a variety of industries. Other current investments of MSD Capital's Private Equity group include ValleyCrest Companies, the largest integrated landscape services provider in the United States, and Tygris Commercial Finance Group, a commercial finance company focusing on middle market corporate finance, middle market equipment leasing and asset finance and small ticket leasing. For additional information, visit www.msdcapital.com.



About North Peak Capital LLC

North Peak Capital LLC is a private equity firm that invests in small- to medium-sized companies, primarily in the healthcare services and for-profit education industries. North Peak Capital seeks to invest in the following areas within healthcare services: facilities based and non-facilities based providers, healthcare billing and collections, workers' compensation, and medical and non-medical staffing. Within for-profit education, the firm is focused on: post-secondary education; standardized test preparation; K-12 tutoring services; and assessment and testing products. For additional information, visit www.northpeakcapital.com.



Contact: Todd Fogarty, Kekst and Company, 212-521-4854, todd-fogarty@kekst.com





SOURCE Dental One, Inc. and MSD Capital, L.P.
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