NHS practice values increase while private goodwill values drop
NHS practice sales as a percentage of goodwill have increased while valuations have dropped, according to NASDAL.
The National Association of Specialist Dental Accountants and Lawyers’ (NASDAL’s) latest quarterly goodwill survey has shown that the average goodwill value for an NHS practice is 140% of the turnover, up from 125% in the previous quarter, whilst valuations of practices have dropped to become more in line with this.
‘It does seem counter intuitive to me that such high values are being paid for NHS practices when we are in a time of potential reform and an uncertain future,’ Alan Suggett, specialist dental accountant and partner in UNW LLP, said.
‘Both corporates and mini-corporates appear to be voracious in their appetites and are almost in a type of “land grab”.
‘However, the demand is there and the market is simply responding to that.’
Mixed and private practices
Elsewhere mixed practices’ average goodwill has increased to 122% in the quarter ending in October.
Private practice prices dropped slightly, however, with an average goodwill of 76% of the turnover, compared with 81% in the previous quarter.
‘These figures reflect what we have seen on the ground,’ Ray Goodman, managing director of Goodman Grant Solicitors Ltd, said.
‘The downturn in valuations I would suggest may be down to the many that are carried out for other purposes rather than sale eg incorporation, probate and so on.’