Q&M to buy Australian dental group for A$144.5 million

[SINGAPORE] Q&M Dental is proposing to buy a 100 per cent stake of a dental group in Australia for A$144.5 million (S$132.1 million), it said in a bourse filing on Wednesday (Mar 11).

Q&M said the deal supports its “long-term strategic objectives of expanding its footprint beyond Singapore and strengthening its presence in the Asia-Pacific region”. It did not name the company that it is proposing to acquire.

The group had announced in October 2025 that it was looking to buy equity interest in a dental group in Thailand.

The latest proposed acquisition will enable “a measured and strategic entry into the Australian market through an established and scalable platform”, Q&M said.

The Australian company “operates a network of more than 40 dental clinics” across various states in the country.

Q&M said this network provides a “strategic operating base that can be further expanded over time through organic growth and potential future acquisitions”.

It intends to grow the Australian company’s specialist divisions; the target currently has a clinical team of about 120 dentists, most of whom are general practitioners.

The Singapore-listed group may also “leverage its experience in scaling, managing, and operating dental clinics to optimise the performance” of the Australian company’s network and “drive long-term growth”.

Q&M said that A$30 million, or about 21 per cent of the sale price, will be injected into the Australian company as capital; this will go towards paying its outstanding loans.

Another A$59.5 million, or about 41 per cent, will be paid in cash to the sellers, with a first tranche of A$40.75 million upon the deal’s completion and a second tranche of A$18.75 million one year later, on the condition that the sellers achieve a profit guarantee target for the first year.

The remaining A$55 million or 38 per cent of the sale price will be used to issue new shares to the sellers at an issue price of S$0.70 apiece. The sellers will not be able to sell these shares for 15 years.

The acquisition is being backed by a profit guarantee of about A$105.7 million for seven years upon completion.

The target is for the Australian company to hit a consolidated net profit after tax of A$11.7 million in the first year, progressively increasing to A$17.1 million by the fifth year, and then maintaining at that level for the sixth and seventh years.

This would represent a growth rate of about 10 per cent on a year-on-year basis for the first five years.

In support of the profit guarantee, the sellers have agreed to deposit A$8 million cash in an escrow account maintained by Q&M to satisfy any shortfall payment if the Australian company’s actual profits fall below targets.

If the Australian company meets or exceeds the profit target for the first year, the amount in the escrow account will be reduced to A$5.5 million for the remaining six years.

The sellers comprise eight founding dentist shareholders, who are “expected to remain actively involved in the business and will serve as key strategic partners” of Q&M in the Australian market.

Q&M said that these sellers will “play an important role in supporting the group’s future expansion plans in Australia”, given their continued operational involvement, local market expertise and alignment with the long-term growth of the platform.

The group also noted “strong similarities” between the Australian company’s growth trajectory and operating philosophy and its own.

“Over time, (the selling shareholders) may also form part of the future leadership and succession pipeline of the company as the group continues to grow its regional dental platform,” Q&M added.

Shares of Q&M rose 3.8 per cent or S$0.02 to close at S$0.54 on Wednesday, before the news.