Aspen Dental and Kool Smiles are each the target of takeover bids by private equity firms, according to a story in the New York Post.
Aspen, with nearly 300 branches across the U.S., is working with investment bank Moelis & Co. to sell itself and is close to finalizing a deal valued at more than $500 million, the Post reported.
Meanwhile, Kool Smiles has hired investment bank Harris Williams, the Post said.
Private-equity firms like dental offices because they sell for low valuations and "a fair amount of money" can be borrowed against them because of reliable cash flow, an investment banker told the Post.
Private equity firms already own the Forba and Bright Now dental chains, according to the Post. Forba, which manages dozens of Small Smiles clinics in the U.S. was acquired by Arcapita in September 2006. Private equity firm Freeman Spogli & Co. owns more than 70% of Bright Now, which is operated by Smile Brands Group.
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