finance For A GP Practice Acquisition

finance For A GP Practice Acquisition

Our client, referred by a long-standing contact of Forecast Finance, needed funding to purchase a GP practice under a tight deadline.

The urgency was driven by the vendor’s concern that the Autumn Budget 2024 would negatively impact the deal, pushing for completion within four weeks.

Recognising the importance of meeting this deadline, we quickly identified Lloyds Bank as a suitable lender and worked closely with key stakeholders to secure the financing.

The agreed purchase price of £955,000 fell between two valuations: £1,075,000 (2019, vendor-instructed) and £835,000 (2024, buyer-instructed). The loan covered 100% of the B&M purchase price, with any shortfall split equally among the three partners as an unsecured loan.

The practice was in good condition, requiring only minor cosmetic upgrades. The partners had set aside £150,000 for improvements but chose to defer spending until after the acquisition.

With 7,900 patients growing at 10% annually and a maximum capacity of 12,000, the practice showed strong growth potential. The notional rent was £65,000 per annum, and a rent increase application was intentionally deferred to maintain a lower B&M valuation pre-purchase.

To optimise tax efficiency, the partners secured confirmation from HMRC that Stamp Duty Land Tax (SDLT) would not apply. They also sought the longest available loan term, ideally 25 years, and expressed flexibility in relocating their banking relationship if necessary to secure the best possible financing terms.

Despite an unforeseen legal delay, we successfully navigated the challenges, ensuring the client had access to competitive funding options. Our expertise in structuring the deal, combined with our strong lender relationships, allowed us to position the transaction favourably in the market.