PE firm JLL Partners to buy American Dental Partners for $398 million

JLL Partners, a New York-based private equity firm with $4 billion of capital under management, today agreed to buy American Dental Partners Inc (ADP), in a cash deal worth $398 million.

JLL Partners will pay $19 per share, representing a premium of 83 per cent over the ADP's closing price of $10.38 on 4 November, valuing the company at around $317 million. JLL Partners will assume ADP's $81million outstanding debt.

Under the terms of the merger, which is expected to close during the first quarter of 2012, ADP may solicit proposals from third parties for 40 days from the date of the merger agreement and JLL has a right to match a superior proposal.

ADP, headquartered in Wakefield, Massachusetts, is one of the leading business partners to dental group practices in the US. It is affiliated with 27 dental group practices, which have 282 dental facilities in 21 states of the US.

Reporting its third-quarter revenues yesterday, ADP had sales of $70.2 million for the three month period that ended 30 September, down from $71.1 million in the same period last year.

Net income was $2.67 million, down from $2.72 million in the same period in 2010.

A special committee of the company's board of directors, composed of six independent directors, negotiated the transaction and recommended it to the full board.

It is expected that Gregory Serrao, ADP's CEO, and other members of senior management will continue in their roles with the company after the completion of the transaction.