Slow the Roll-up: Help Shine a Light on Serial Acquisitions

Most of the talk about dealmaking and antitrust enforcement focuses on large deals involving large companies. That’s because every year, the antitrust agencies get notice of larger deals—those currently valued at over $119.5 million—under the Hart-Scott-Rodino Act. But roll-up schemes, popular with private equity companies and other corporate actors, can be executed through a series of smaller acquisitions that individually fall below the threshold for reporting to the antitrust agencies. A series of relatively small acquisitions can have the same impact on competition as one large one, allowing one firm to eliminate competition and amass significant control over products and services without review by the antitrust agencies. This is especially a concern in sectors where competition occurs primarily at the local level, such as healthcare or retail.

Serial acquisitions that eliminate small competitors over time can have serious consequences for consumers, workers, and businesses. Once the antitrust agencies detect that a firm is relying on a strategy of serial acquisitions to buy up small competitors, they can take action. For instance, the FTC has challenged serial acquisitions involving anesthesiology practices, veterinary clinics and dialysis clinics while DOJ has challenged acquisitions involving dairy processors. But there are growing concerns about the proliferation of serial acquisition strategies, especially among private equity firms, real estate investment trusts, and other corporate actors. The antitrust agencies are seeking the public’s help in identifying other sectors where these strategies may be underway and under the radar.

Today, the FTC and DOJ have released a “Request for Information for Public Comment on Corporate Consolidation Through Serial Acquisitions and Roll-Up Strategies.” This RFI seeks information on serial acquisitions in any sector of the U.S. economy, including but not limited to housing, defense, cybersecurity, distribution, agriculture, construction, and aftermarket/repair markets. To have a more complete picture of how roll-ups are impacting the economy, we welcome input from consumers, workers, businesses, advocacy organizations, professional and trade associations, local, state, and federal elected officials, and academics and other experts with knowledge of the operation of specific industries and the effects of serial acquisitions more generally.

You can play an important role in helping the antitrust agencies detect and deter serial acquisition strategies. If you have any experience with serial acquisitions—as a consumer, worker, supplier, business, or otherwise—please consider sharing that experience with us by submitting a public comment. Your comments will go a long way to helping us understand the ways that roll-up acquisition strategies may lead to consolidation, higher prices, lower quality, or fewer choices for important products or services, leaving the American public worse off.