skip content up to navigation menus

Increasingly we are being approached by practices who wish to merge.  This may arise either because a singlehanded practitioner is planning ahead for his/her retirement, or because practices see the benefit of not only cost efficiencies, but also opportunities through operating as larger units. 

What may not be appreciated however is that the merger of 2 (or more) practices brings with it the historical ‘baggage’ from all sides.  What may initially appear to be an entirely straightforward negotiation governing the PCT Contracts, might result in a surprisingly long list of additional issues to resolve.

The ‘best practice’ advice we can offer is to undertake a full due diligence exercise (as would routinely be done in any other type of business merger).  This serves the purpose of flushing out any potential problems which, may come back to haunt the newly merged practice at a later date, and presents an opportunity for indemnities to be agreed.

In addition, the following points will require consideration:

1. Staff

• The transfer of staff to the newly merged practice by TUPE

2. Premises

• Ownership: the sales/purchases of shares (and transfers of existing mortgages)
• Occupation: the grant of new Leases from each practice to the other

3. Transfers of other contractual arrangements

4. New Partnership Deed

• This may include details relating to the mechanism of the transfer/merger of the businesses themselves 

Once everything else is in place, it will then be necessary to serve the relevant notices upon the PCT for the transfer of the names on the Contract (where this is possible under GMS).  However, this is not automatically possible for PMS Contracts, and additional time may be required to allow for further negotiation with the PCT.

Overall, the entire process is likely to take several months, so advance planning is essential in order to ensure there is adequate time to deal with the constituent parts (to include compliance with legislation relating to essential notice periods). 

For these reasons, it is important to take early advice long before you anticipate the merger taking place, in order that you can ensure your merger date is not unnecessarily postponed.

• Training & Events
• Key Contacts