Smile Care signed a six-month MoU for a three-branch dental group in Qassim with no price attached. On the day the six months ran out, it walked away, having licensed two new Riyadh branches of its own in September.
On 8 October 2026 Basma Adeem Medical Co., which trades as Smile Care, told the Saudi Exchange it had mutually terminated its memorandum of understanding to buy 100% of Fahad Abdullah Al-Ajaji Dental Complex Company, a dental and dermatology group with three branches in Qassim, because the parties could not reach a final agreement. The non-binding MoU, signed on 8 April for six calendar months and extendable, never disclosed a price. It proposed paying in cash, new shares and performance-linked deferred payments, with the final value set after valuation and due diligence satisfactory to the buyer. In September the buyer licensed its third and fourth Riyadh branches. For a clinic owner approached by a listed acquirer, the lesson is where the bargaining power sits before the MoU is signed.
What a board member needs before the next meeting on this.
- The MoU ended on its six-month mark. Signed on 8 April 2026 for six calendar months and extendable by agreement, it was mutually terminated on 8 October 2026, on our count the day the term ran out. The parties did not extend it.
- No price was ever disclosed. The MoU left the final value to be set after valuation, due diligence and approvals, and made a binding agreement conditional on results satisfactory to the buyer. The seller signed without a number.
- Three forms of payment meant three negotiations. The consideration was to combine cash, new shares in the listed buyer and deferred payments linked to performance. The filing does not say which part failed; each carries its own terms to agree.
- The buyer had a greenfield alternative. Smile Care licensed its third Riyadh branch on 8 September 2026 and its fourth on 30 September 2026. On our reading, a buyer that can open its own branches prices an acquisition against that alternative.
On 8 October 2026 Basma Adeem Medical Co., which trades as Smile Care and is listed on the Saudi Exchange under symbol 9626, announced that it would not proceed with its acquisition of Fahad Abdullah Al-Ajaji Dental Complex Company and had mutually terminated the memorandum of understanding with the seller, Al-Ajaji Trading Company, because the two sides failed to reach a final agreement (Saudi Exchange, anId 98465).
The company said the termination carries no additional financial obligation and no material financial impact. A cancelled clinic deal with no price is easy to skip. The terms of the MoU that preceded it explain why it ended where it did.
The MoU gave the seller nothing to hold
The memorandum, signed on 8 April 2026 and announced the next day, covered 100% of a limited liability company running dental and dermatology clinics, including all three of its branches in the Qassim region with their assets and liabilities (Saudi Exchange, anId 94319). It was non-binding. It stated no price.
The final value was to be set after the financial valuation, due diligence and regulatory approvals, and a binding sale and purchase agreement would follow only once due diligence and valuation results were satisfactory to the buyer. The buyer described the deal as part of its strategy to strengthen its presence in the medical sector and expand its business base.
The seller had committed to six months of negotiation in which the buyer set the test for both the number and the diligence outcome, and in which nothing it disclosed could be withdrawn once the buyer had read it.
The clock ran out and nobody wound it back
The MoU ran for six calendar months from signing, extendable by agreement of both parties (Saudi Exchange, anId 94319). The termination was announced on 8 October, which on our count is the day that term ended. An extension needed only both signatures. Neither side used it, and on our reading that tells a seller more than the filing's stated reason does: by the end of the term, the gap was not one either side expected an extension to close.
Buying, selling or valuing a healthcare business? Talk to the principal who runs the deal. Discuss a transaction
Three forms of payment are three negotiations
The consideration was to combine cash, newly issued shares in the buyer and deferred payments linked to performance (Saudi Exchange, anId 98465). The filing does not say which element failed, and we do not guess. Each one, though, is a separate agreement. Paying in shares requires the parties to agree the price at which they are issued and what the seller may do with them.
A performance-linked payment requires a measure, a period and an answer on who runs the clinics while it is earned. In a roll-up structured this way, the seller takes part of the price in the buyer's shares and part in its own future results, and every one of those terms has to be agreed before a binding contract exists.
The buyer was building while it negotiated
In the month before the termination, Smile Care announced two Ministry of Health licences: its third dental clinic branch, in the King Abdullah Financial District in Riyadh, on 8 September 2026 (Saudi Exchange, anId 98060), and its fourth, in Al-Narjis, Riyadh, on 30 September 2026, with financial impact expected from the fourth quarter (Saudi Exchange, anId 98343).
On our reading, that is the number a seller negotiates against. A listed buyer that can license and open its own branches will pay for an existing group only what it saves in time and cost over building the equivalent, and it can walk away when the asking price exceeds that.
Geography cuts the same way. The target's three branches are in Qassim; both new branches are in Riyadh. An acquisition would have bought a regional footprint at once, and the buyer kept growing in Riyadh while it decided whether that was worth the price.
Four questions before a clinic owner signs an MoU with a listed buyer
- Does the MoU state a price, a range or at least a valuation method, or is the final value left to the buyer's satisfaction?
- If part of the price is paid in new shares, at what share price, with what lock-up, and after which approvals?
- How is the performance-linked deferred payment measured, over what period, and who controls the clinics while it is earned?
- What would it cost the buyer, and how long would it take, to open the same number of licensed branches itself?
The Monday work for a clinic owner approached by a listed buyer comes before signing anything. Ask for a price, a range or a stated valuation method in the MoU itself. If part of the payment is in shares, agree the issue price basis and any lock-up at heads-of-terms stage.
Define the performance measure behind any deferred payment and who controls the clinics while it is earned. Then estimate what it would cost the buyer to open the same branches itself, because that sets the ceiling. That preparation is where our sell-side M&A practice starts.
Subscribe
The UAE healthcare regulatory briefing
What changed, what it reprices, and the instrument to read. Every second Tuesday. No pitches.
One email a fortnight. Unsubscribe from any of them.