KKR invests in merger of Peloton-backed 123Dentist, Sentinel-backed Altima

The merger will create one of the largest dental support organizations in Canada with nearly 350 supported dental practices.

  • The deal is being funded by Peloton Capital Management, KKR, Heartland Dental and Sentinel Capital Partners
  • As part of the deal, Heartland will support the expansion of education and training at 123Dentist
  • Heartland was acquired by KKR in 2018

Peloton Capital-backed 123Dentist and Sentinel Capital Partners-backed Altima Dental, alongside Lapointe Group, have entered into a merger agreement to create one of the largest dental support organizations in Canada. The deal is being backed by equity provided by Peloton Capital Management, Sentinel Capital Partners, KKR and KKR’s portfolio company Heartland Dental.

Toronto-based private equity firm Peloton Capital Management first invested in 123Dentist in 2019. It will be raising additional funds to support the merger. Peloton was founded by veterans of Ontario Teachers’ Pension Plan and closed its debut fund last year.

“This is a transformative transaction for 123Dentist, and we look forward to continuing to support the management team,” said Steve Faraone, managing partner at Peloton. “123Dentist has established itself as one of the largest dental support organizations in Canada, providing a sustainable partnership model that allows its dentist partners to put patient care at the forefront. Expanding the relationship with Pat Bauer, Rick Workman, and the Heartland Dental team will be an incredible benefit to 123Dentist, allowing the team to learn from them to support its growth.”

“We expect this merger to benefit Canadian dentists, dental professionals and patients alike, greatly expanding support services for an already thriving dentist community that focuses on the delivery of exceptional care, improving access to high quality dentistry services, and increasing opportunities for career advancement and mentorship for our team members,” said Amin Shivji, CEO of 123Dentist.

The combined business of 123Dentist and Altima Dental will have a national footprint and support practices that provide dental care to more than 800,000 Canadian patients with over 2.5 million patient visits annually.

New York-based private equity firm Sentinel Capital Partners invested in Altima Dental in 2016. It will maintain a minority stake in the combined entity alongside the founders of both Altima Dental and Lapointe Group. “We are grateful for the strong partnership we have had with the founders and management teams at Altima Dental and Lapointe Group,” said Paul Murphy, partner at Sentinel. “We are looking forward to supporting the combined 123Dentist team as they continue to build a leading dentist-centric organization.”

KKR acquired Heartland Dental in 2018 and has helped the company scale and double its number of practices to over 1,600 in 38 US states.

“We believe this is an excellent strategic partnership that shares a common mission of supporting dentists providing high-quality dental care to Canadians,” said Vishal Patel, a Managing Director at KKR. “Working alongside the talented teams from 123Dentist, Altima Dental and Lapointe Group, as well as Peloton and Heartland Dental, the company is primed to scale to the benefit of thousands of supported dentists and patients across Canada.”

As part of the deal, Heartland will support the expansion of education and training at 123Dentist. 123Dentist will gain access to the company’s continuing education programs to improve patient experience, patient care and expand the capabilities of its supported practices.