Buying a veterinary practice in the UK is a major commercial step and often one of the largest financial commitments a vet will make. Whether you are researching how much it costs to buy a veterinary practice, buying into a veterinary practice for the first time, or expanding an existing group, it is important to understand the legal and practical steps involved. Instructing a specialist solicitor who can provide you with legal advice early can help ensure the transaction is structured correctly and risks are identified before you commit.
How much does it cost to buy a veterinary practice in the UK?
The cost of buying a veterinary practice in the UK varies widely and will depend on multiple factors, including:
- Location, size and reputation of the practice
- Turnover, profitability and growth potential
- Whether the premises are freehold or leasehold
- Staffing arrangements, including associates and locums
- Existing contracts, liabilities and regulatory obligations
Smaller independent practices can be purchased for several hundred thousand pounds, while larger or multi-site practices can exceed £1 million. If you are looking to buy a practice, you should also budget for professional fees, lender costs and transaction expenses alongside the purchase price.
Steps to buying a veterinary practice
Every transaction is different, but the legal process will usually include:
- Agreeing on heads of terms or a memorandum of sale
- Securing exclusivity and agreeing on any deposit arrangements
- Structuring the acquisition and any third-party funding
- Carrying out legal, financial and property due diligence
- Negotiating and completing the purchase documentation
- Completion and post-completion filings and registrations
Taking time to set out the process clearly at the outset helps manage expectations and avoid delays.
Buying into a veterinary practice
Many vets choose to buy into an existing veterinary practice rather than acquire the whole business outright. This may involve acquiring shares in a limited company or joining a partnership or LLP.
In these situations, the legal documentation is critical. Shareholders’ agreements or partnership agreements govern decision-making, profit distribution, future buy-outs and exit arrangements. Poorly drafted or outdated agreements can increase the risk of disputes and unexpected financial exposure later.
Asset purchase or share purchase – which structure is right?
Where a practice is owned by a limited company, buyers will usually acquire it by way of either a share purchase, where the buyer acquires the company “warts and all” and assumes responsibility for its historic and future liabilities, or an asset purchase, where the buyer cherry-picks the assets of the practice, such as goodwill, equipment, staff, contracts and property, without taking responsibility for past liabilities.
Tax advice should always be taken alongside legal advice, as the chosen structure can have significant tax consequences for both parties.
Due diligence when buying a veterinary practice
Due diligence allows the buyer to understand exactly what they are acquiring. In a veterinary practice purchase, this commonly covers:
- Business structure and ownership
- Compliance with Royal College of Veterinary Surgeons requirements
- Employment and associate arrangements
- Supply, waste and out-of-hours agreements
- Regulatory inspections and consents
- GDPR and data protection compliance
- Property ownership, leases and searches
Property due diligence may include landlord enquiries, lease assignment or grant, searches and, in some cases, a structural survey, particularly where lender funding is involved. For the more complex situations, our commercial property solicitors will work in partnership with our commercial healthcare solicitors.
Financing the purchase of a veterinary practice
Many purchases involve a combination of personal funds and external finance. Lenders will usually require security, which may include charges over property and personal guarantees. We recommend that all buyers seek independent financial advice before committing to borrowing.
Goodwill and restrictive covenants
A significant proportion of the purchase price is usually attributed to goodwill, including reputation, client base and profitability. Buyers should consider protecting this value through restrictive covenants, such as non-compete and non-solicitation clauses, to prevent sellers from setting up or joining a competing practice nearby.
What are the legal costs of buying a veterinary practice?
When buying a veterinary practice, the associated legal fees will depend on the structure and complexity of the transaction, including whether the acquisition is an asset or share purchase and the nature of any property work involved.
As a general guide, simpler acquisitions may fall within the region of £7,500 – £10,000 plus VAT and disbursements. More complex transactions may be in the region of £13,000 – £16,000 plus VAT and disbursements.
Wherever possible, we aim to provide a fixed fee at the outset, to provide you with as much clarity and certainty as possible.
Contact Scott Bailey today
The corporate and commercial team at Scott Bailey LLP regularly advise clients across England and Wales on buying veterinary practices, including buy-ins, group expansion and acquisitions. We also handle the commercial property aspects of veterinary practice purchases, ensuring the process is coordinated and efficient. Get in touch today for legal support or advice about buying a veterinary practice.
