What happens
Seven steps from the first assessment to the list of buyers worth approaching.
Selling a medical practice
Selling a GP practice starts well before a buyer is approached. A buyer's adviser works through the financials, the GP agreements, the lease and the compliance record, and prices every gap they find as risk. In the year or more before a sale, the owner closes those gaps: the owner's accountant separates the practice's earnings from the owner's own billings, the owner brings every GP agreement up to date, and together they assemble the documents the adviser will ask for in a form the adviser can check.
Once the practice is ready, each owner records what they want from the sale, Proxeno identifies the buyers whose holdings and location suit the practice, and the owners go into negotiation having already agreed among themselves on price, timing and the buyers they would accept. Preparation takes twelve to eighteen months. The sale itself takes a further six to twelve months.
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Review the operation of your practice, then your sale readiness
Start with the business acuity assessment: a free review of how the practice operates as a business, scored across six areas, that sets your baseline. When you are ready to sell, the sale readiness check scores the practice across the five areas a buyer's advisers test, and sets out the priority gaps and the action that closes each.
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Fill in the intake form
Seven sections covering what a buyer's adviser works through: the practice and its entity, your GP roster, financials, property, legal and agreements, operations, and workforce and succession.
Approximate figures are fine and accounting exports are fine. Your answers stay on your own device until you send them. The form adds up your sessions, converts them to FTE and totals your billings as you type.
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Each owner fills in the preferences form, on their own
About ten minutes each, done separately rather than around a table. Twelve factors rated one to five, the deal structures you would accept, the buyer types you would and would not sell to, your timing and your non-negotiables.
Push one factor up and the others fall.
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Send it back
The intake form produces a file to send to sellers@proxeno.io. Each owner's preferences reach us through the form itself when they submit.
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We build your marketing document
The document you put in front of a buyer: the practice, its income, its GPs, its nursing and allied health, its premises and agreements, and its terms of sale. Written to answer what a buyer's adviser asks first.
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Your owner comparison report
Where a practice has more than one owner, every owner's answers go side by side. Shared priorities, the factors where you differ by two points or more, deal structures one owner has ruled out that another accepts, and buyer types anyone has vetoed. Then whether a buyer type exists that all of you would sell to.
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The list of buyers worth approaching
From the GP Zoo dataset of who owns Australian general practice, grouped into three tiers, with what each one owns, where, and what they have bought recently. The three tiers are set out on the seller page.
How long a practice sale takes
Preparation takes twelve to eighteen months because a buyer pays for results that have held over time. A buyer gives little weight to a rise in earnings this quarter until the rise has held across a full financial year, and a GP who joined six months ago is not yet part of the workforce a buyer will pay for. In that period the owner's accountant separates the practice's earnings from the owner's billings and assesses the payroll tax position on contractor GPs. The owner brings GP agreements up to date and secures the lease.
The sale takes six to twelve months from the first approach to settlement. Most of that time goes to due diligence, the buyer's finance and the sale contract. A practice in a capital city usually attracts a buyer sooner than a rural practice, where there are fewer buyers.
The buyer's adviser finds any gap the owner has not closed. When the adviser finds accounts that mix the owner's billings with the practice's earnings, or a payroll tax position no one has assessed, the parties reopen terms that looked settled and the sale slows. Co-owners who have not agreed among themselves on price, timing or the buyers they would accept have to settle those questions with a buyer waiting. Proxeno's preferences form (step 3) has each owner record their priorities separately before any buyer is approached, so the owners see where they disagree while there is still time to resolve it.
Which documents will a buyer need?
A buyer's adviser asks for much the same documents in every practice sale. Each one answers a question about whether the practice's earnings will hold after settlement. Where a document is missing, the buyer answers the question itself by lowering the price or adding conditions to the contract.
- Three years of financial statements, with the owner's billings separated from the practice's earnings. The buyer pays for what the practice earns without the owner, so the accounts have to show that figure.
- A current signed agreement for every GP, whether engaged as a contractor or an employee. GPs bill under their own provider numbers and their patients may follow them, so the clauses in these agreements tell the buyer how much of the revenue is secure.
- The lease: remaining term, options and rent, and whether the building is included in the sale. A buyer who keeps the site needs tenure that covers the years it expects to own the practice.
- Accreditation records against the RACGP Standards for general practices. A practice must be accredited to receive Practice Incentives Program payments, so a lapse puts income at risk.
- An assessment of the payroll tax position on contractor GPs. Where a state revenue office treats the arrangements as employment, the practice owes payroll tax at the state rate on what it pays its GPs, and the liability can reach back several years. A buyer will not take on an exposure no one has measured.
- A description of how patient records are held. Health records legislation in New South Wales, Victoria and the ACT requires a practice to keep records for adult patients for at least seven years, and the buyer inherits that obligation.
- The GP roster: sessions, FTE and billings for each GP. The roster shows how much of the revenue depends on one or two GPs.
Proxeno built its intake form (step 2) from this list, so an owner who completes the form has assembled what a buyer's adviser asks for.
Your sale
If you are managing the sale yourself, you decide who to contact and you contact them.
If you have a consultant, they set up the introductions to the buyers you have chosen and stay with you through the meetings, briefing you before each one and working through the offers with you afterwards.
Either way you and the buyer agree terms directly, your accountant does the numbers and your lawyer does the contract.