DDSWhat does a re-trade look like?
A re-trade usually arrives as a revised term sheet after diligence. CT Acquisitions defines it as a post-LOI buyer request to change price, structure, escrow, indemnity or earn-out. The headline number may stay the same while cash at close falls, because value moves into an earn-out, a larger holdback or rollover equity.
Read every revised term sheet for structure, not just price; see earn-outs and holdbacks and cash at close in a DSO offer.
Why do re-trades happen in dental deals?
Most trace back to earnings. Rivkin Radler explains that a DSO adjusts EBITDA during financial diligence for non-recurring items, and if the result differs from the letter of intent, it will likely adjust the price it is willing to pay. Legal and regulatory findings can also lead a buyer to cut price or walk.
A multiple is applied to the earnings diligence confirms, so a lower confirmed EBITDA lowers the price even at the same multiple. The quality of earnings review is where those adjustments surface.
Why is the seller weakest after signing the letter of intent?
Exclusivity removes competition. Transitions Elite says a letter of intent is non-binding on price and binding on leverage: signing it sends every competing bidder home, and 60 to 90 days of diligence follow. By the time a re-trade arrives, the seller may have told staff, paid advisors and set a closing date.
The letter of intent and due diligence definitions cover the basics.
How can sellers reduce the chance of a re-trade?
Find the problems before the buyer does. Practice Worth advises running a quality of earnings review on yourself before the letter of intent, while you still have more than one buyer. Then define adjusted EBITDA, owner pay and the working capital method in the letter of intent, and keep exclusivity short.
Disclose known issues early with documentation, agree the active patient definition the buyer will test, and keep a credible alternative buyer warm. Lease and non-compete terms are common late surprises; see lease assignment in a sale and non-competes after a sale.
Pricing context is on practice valuation multiples.
How should sellers respond to a re-trade?
Ask for the evidence and test the method. Request the specific diligence finding, the calculation behind the new number, and whether the issue recurs. CT Acquisitions describes middle-ground responses such as an indemnity escrow instead of a headline price cut, or an earn-out tied to the specific contested metric.
A closing adjustment under an agreed formula, such as the working capital peg, is not a re-trade. If no clause authorizes a price change, treat it as a new offer and compare it with your other exit options. Public-record transition signals never show deal terms.
Frequently asked questions
What is a re-trade?
A buyer’s request, after the letter of intent, to lower the price or change terms such as escrow, earn-out or indemnity.
What usually triggers a re-trade?
Diligence adjustments to EBITDA, declining recent performance, provider departures and legal or compliance findings.
Can a buyer re-trade after signing a letter of intent?
Most letters of intent are non-binding on price, so a buyer can propose new terms; the seller can accept, negotiate or walk away.
Is a re-trade always a price cut?
No. Buyers often move cash at close into earn-outs, escrow or rollover equity while keeping the headline value.
Can DDSIntel help me respond to a re-trade?
No. DDSIntel publishes aggregate education and dental market data only; use your transaction attorney and CPA.
Sources
- CT Acquisitions. How to handle buyer retrading post-LOI (last reviewed July 2026). ctacquisitions.com.
- Rivkin Radler. Due diligence: a critical component of any transaction. rivkinradler.com.
- Transitions Elite. The DSO letter of intent (Aug. 31, 2026). transitionselite.com.
- Practice Worth. Quality of earnings in a dental practice sale (Oct. 27, 2026). getpracticeworth.com.
- TUSK Practice Sales. TUSK Practice Sales Assesses the State of the Dental Industry in Its Q3 2026 Dental Market Report (July 10, 2026). pr.timesenterprise.com.
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