Larger DSOs are increasingly acquiring or affiliating with smaller groups, and Heartland Dental’s most recent deal with Foundation Dental Partners is the latest example.
Becker’s has reported on several of these deals since the start of 2025. Last year, myOrthos and BrookBeam Dental were acquired by larger groups in two separate transactions. Earlier this year, Gen4 Dental Partners, Modis Dental Partners and SGA Dental Partners merged under a single brand, creating one of the largest DSOs in the U.S. Miami-based Guardian Dentistry Partners also agreed to buy Select Dental Management, while Roseville, Minn.-based Park Dental Partners plans to close its acquisition of Village Family Dental DSO later this year.
Heartland Dental most recently affiliated with Alpharetta, Ga.-based Foundation Dental Partners, a 33-practice DSO. This follows two other deals since 2020 in which the DSO acquired Smile Design Dentistry, a DSO with 60 offices in Florida, and Tru Family Dental, a DSO with more than 20 offices in Illinois and Michigan.
Many of these groups are long-held private equity assets whose investors want to monetize, and higher interest rates have made it harder to keep growing, according to Mark Greenstein, chief growth officer at Heartland Dental.
Mr. Greenstein recently spoke with Becker’s to discuss this trend, and how it has affected the DSO market:
Editor’s note: Responses were lightly edited for clarity and length.
Question: There have been several deals this year involving larger DSOs acquiring and affiliating with smaller platforms. What is driving this trend?
Mark Greenstein: Honestly, my sense is there are a lot of assets that are long in the tooth. In other words, they’ve been inside of a private equity construct for a very long time, and the original investors are looking to monetize. That’s led to the ability to purchase [companies] at a fair price from pricing in the past that just didn’t work. You were not able to get a very good risk-adjusted return. We were blessed. That’s one of the benefits of having a de novo model. If you don’t find what you’re looking for on the acquisition side, you’ve got a whole other plank.
So many of these [groups] grew in this 2018 through COVID period, so they’re less than 10 years old, and they grew just because interest rates were low. They didn’t put the energy into thinking about how to actually create value. I think they realized a few years ago when they couldn’t sell, now what are we going to do? So, they started to do the things that Heartland always does, and they’ve created more valuable assets. The quality of what’s out there now is better. Pricing expectations are more in line with the value that’s actually been created. They’ve actually started to create value in several dimensions. There are more doctors that have been there for a longer period of time, so it’s not just churning through doctors. That, to us, is a real signal of stability, how embedded they are with their communities and the overall quality.
Many of these startups from the last decade or eight years have finally recognized they weren’t going to sell. They recognized they had to create value to get the EBITDA to try to get enough of a return to make everybody happy, whether it’s the debtors or the equity holders, and they’re willing to monetize what they have because interest rates now are very high, so it’s very difficult for them to continue to grow the assets. They have to grow by creating value to get the pricing that would work for them, and that’s what we’re out there looking for. We’re looking for that quality at a fair price.
