>"He observed that “68% of private equity buyouts are add-ons from previous acquisitions,” which is to say that most acquisitions by private equity firms are at

>"He observed that “68% of private equity buyouts are add-ons from previous acquisitions,” which is to say that most acquisitions by private equity firms are attempts to expand market power for companies they already own. A quarter of these acquisitions, in fact, are “tied to an investment with at least five add-ons.” Given that there are thousands of private equity firms making transactions every year, that’s a lot of attempts to increase market power." [...] "Doing a roll-up is designed to take advantage of how capital markets value bigger companies versus small ones, or what is called multiple expansion. Buying a small family owned business for three to four times its cash flow (or what is known in annoying accounting-speak as earnings before interest, taxes, depreciation, and amortization, abbreviated as EBITDA), putting it into a conglomerate that financiers then call a ‘platform’ or ‘market leader’, means you can often sell the much bigger company for eight to ten times that cash flow later on." My comments: Buy low, sell high... Makes sense from a pure business perspective...