China's CITIC sells US dental business

The original investment was made in 2014 via CITIC's third international fund, where the typical approach was to acquire Western companies that are underachieving or underpenetrated in China and help them realize their potential. This strategy was folded into the main fund with the launch of CITIC Capital China Partners III in 2016 and the domestic and international teams were combined.

Prior to DDS, CITIC had completed more than a dozen deals in the US, always participating as the minority partner alongside a domestic GP. In this instance, Florida-based Blue Sea Capital took on the minority role. It is exiting alongside CITIC.

Established in 2005, DDS sells custom dental prosthetic appliances – fixed crown and bridge, removable, implant and orthodontic products – to dental service organizations, mid-size group practices, and sole practitioner dentists across the US. It is headquartered in Tampa, Florida. During the holding period, the company's headcount has approximately doubled in size to 1,200.

"We are proud to have supported DDS Lab's management team over the last few years. Through investments in the company's organization and digital capabilities, the team did a phenomenal job driving robust organic growth and solidifying its position in the market," said Hans Allegaert, a managing director at CITIC, in a statement.

Blue Sea is a middle-market private equity firm that writes equity checks no larger than $60 million for companies with at least $30 million in EBTIDA and $200 million in enterprise value. The GP closed its second fund a few weeks ago at $430 million. RoundTable is a healthcare-focused investor currently deploying its fifth fund, which has a corpus of $700 million.

CITIC closed its fourth China buyout fund at the hard cap of $2.8 billion in 2019. International deals – often global corporates divesting China divisions or companies with strong growth prospects in China – remain part of the strategy. Recent activity includes the acquisition of Swedish intimate lifestyle brand Lelo and the sale of intelligence database provider ISI Emerging Markets Group.

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• Topics
• Greater China
• North America
• Trade sale
• Healthcare
• CITIC Capital
• USA