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Answers · Deal Structures & MSOs
PE buyers use several structures, and the right one depends on your goals. Common forms include a joint venture, where the buyer takes a majority interest while you retain equity and distributions, an asset purchase, and a stock sale. Deal value is split across cash at close, rollover equity, promissory notes, and earnouts. In many states, MSO and management arrangements are also used to satisfy corporate-practice-of-medicine rules.
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The Structures PE Buyers Use
PE buyers use several structures, and the right one for your practice depends on your goals. The differences show up in who holds equity after close, how you actually get paid, and whether a separate management company sits alongside a physician-owned entity to satisfy corporate-practice-of-medicine rules.
The buyer takes a majority interest while you retain equity and distributions, staying invested in the practice's value alongside the new majority owner.
The buyer purchases the practice's operating assets or the stock of the practice entity directly. In corporate-practice-of-medicine states, that path is not available to a non-physician buyer without an MSO wrap alongside it.
A physician-owned entity keeps the clinical practice, and a separate management company, the part the investor actually owns and funds, contracts to provide non-clinical business services for a fee.
Deal value is split across cash at close, rollover equity, promissory notes, and earnouts, in a mix that depends on your goals and the buyer's own structure.
| Structure | What changes | Where it typically applies |
|---|---|---|
| Joint venture / majority recap | You retain minority equity | Used broadly as a standalone form |
| Asset purchase / stock sale | Buyer acquires assets or equity directly | Where CPOM rules don't require a management layer |
| MSO & management arrangement | Management-fee stream, not a clinical-entity sale | Corporate-practice-of-medicine states, such as Texas and California |
This is general information about deal structure, not legal advice for your specific transaction. Corporate-practice-of-medicine rules vary by state, and the structure that fits your practice comes from a confidential, practice-specific review.
The Regulatory Layer
Corporate-practice-of-medicine rules vary by state, and the structure that is legal in Texas is not necessarily legal in California. A generalist broker may not know the difference between a simple asset purchase and a management services organization arrangement, or why the distinction matters for your close. We know which buyer types prefer which structures, how to document a compliant physician oversight agreement before you go to market, and what a quality-of-earnings team will flag on day one of diligence.
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Who you work with
Bill Walker founded Aesthetic Brokers after leading mergers and acquisitions for a large private-equity-backed healthcare services organization. Before that he flew for the Marine Corps at the Presidential Helicopter Squadron and commanded a squadron in combat. He knows how an investor values a practice, and how to make sure that value lands with you, not the buyer.
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