Gary Carroll joins Pacific Smiles as new CEO after board rejects latest takeover offer

After a tumultuous year, takeover target Pacific Smiles has appointed an experienced chief executive to steady the company.

New Pacific Smiles managing director and chief executive Gary Carroll.

After rejecting a takeover offer backed by its largest shareholder, Pacific Smiles Group has secured an experienced chief executive to guide the dental chain through a volatile period.

The Pacific Smiles board announced the appointment of Gary Carroll as managing director and chief executive on Monday to replace Andrew Vidler, who handed in is resignation a month ago at the same time other executives left the company during a takeover battle.

Mr Carroll was recently CEO of MindChamps Australia, which operates 21 premium early learning and preschool services across NSW and Victoria. From 2017 to 2022, he was the CEO of ASX-listed G8 Education, Australia’s largest for-profit provider of quality early childhood education and care with over 400 centres nationwide.

Pacific Smiles chairman Giselle Collins said Mr Carroll has a track record of bringing strategic discipline and accountability to consumer-facing network businesses such as Pacific Smiles, while achieving efficiencies from scale and driving growth.

“His experience will be invaluable as we work to deliver on the next stage of network optimisation and growth for Pacific Smiles, and the board is looking forward to working with him to unlock the full potential of the group,” she said.

On Friday the Pacific Smiles board formally told shareholders to reject a Genesis Capital-backed Beam Dental Bidco offer of $1.90 per share — valuing the company at just over $300m — with investors offered a choice of cash, scrip or a mixture.

The bid was up from its initial indicative proposal of $1.40 per share in December last year, which was rejected.

Pacific Smiles said the offer was opportunistic and materially below the previous $2.05 per share offer by National Dental Care. Genesis Capital owns 19.9 per cent of Pacific Smiles.

It said MA Financial Group, which has a share holding of 13.43 per cent and Dr Alison Hughes, co-founder of Pacific Smiles and 9.94 per cent shareholder both said they intend to reject the offer.

In April, Crescent Capital-­affiliated National Dental Care lodged a bid of $1.90 per share for the company which was increased to $2.05 — $1.98 in cash plus a 7c dividend — in late July.

That offer was rejected by Pacific Smiles shareholders who — despite a recommendation from the board — voted against the takeover bid at a scheme meeting.

Any offer was subject to a 90 per cent minimum acceptance condition.

At the time, an independent expert had assessed Pacific Smile’s valuation at between $1.80 and $2.17 per share.

Pacific Smiles shares are up 0.9 per cent to $1.86 at 12.40pm AEST.

The stock has been on a rollercoaster ride over the past year amid management upheaval.

Mr Vidler resigned after the Crescent takeover bid was defeated and chair Zita Peach and chief financial officer Matthew Cordingly left in late August.

Mr Vidler will assist Mr Carroll in a two-week period to 28 October 2024.

Mr Carroll said it was an exciting opportunity to lead Pacific Smiles.

“Pacific Smiles is a highly attractive business with a market leading brand, strong invested footprint and capacity for future growth,” he said.

“I can see lots of opportunities for the company and I look forward to working with Giselle, the rest of the Board and the broader Pacific Smiles team as we capitalise on Pacific Smiles’ many strengths.”

Originally published as Gary Carroll joins Pacific Smiles as new CEO after board rejects latest takeover offer