In a renewed examination on anti-competitive practices within the private equity sector, the exploration of roll-up acquisition strategies by major industry players has recently come under heightened scrutiny by the U.S. Federal Trade Commission (FTC). Citing a specific case against a private-equity owner of a large anesthesiology practice in Texas, the industry can glean initial insights into this escalating level of oversight. Learn more about the lawsuit here.
Roll-up strategies, considerably common amongst private equity entities, involve the serial acquisition of multiple companies within a singular market and consolidation under one overarching entity. It is this very strategy under investigation by the FTC due to its potential to create and foster harmful competitive climates.
The increasing boldness of the FTC’s implementation of its aggressive focus is visible in this recent lawsuit. Its objective is to tackle the perceived competitive harms perpetrated by these specific roll-up acquisition methods. Notably, the FTC aims to dissect the complexities of these acquisition trends, further showcasing its willingness to challenge the practices of the private equity industry.
This legal action and the FTC’s renewed focus underlines the ongoing review of antitrust enforcement in the private equity sector. Legal professionals and corporations should remain abreast of these developments to prepare for forthcoming changes in this evolving regulatory landscape.
An overview of the FTC’s investigation, its ongoing evaluation of roll-up strategies, the specific legislation in question and more can be found in the summary by Snell & Wilmer. Find their summary here.