Private equity and serial acquisitions continue to feel the antitrust heat

Serial acquisitions under attack

Concerns over serial acquisitions gathered pace during 2024. Antitrust authorities want to look closely at purchases of small businesses with a view to combining them into a larger entity that concentrates market power. Often, however, these individual acquisitions fall below merger control thresholds, creating review challenges for agencies (also see our article Rising review risk for deals not meeting merger control thresholds).

While serial deals by industrial, tech and healthcare companies are being scrutinized, antitrust authorities also have a particular focus on PE "roll-ups".

The U.S. antitrust agencies have led the charge. The updated Hart-Scott-Rodino (HSR) filing form now requires greater disclosure of certain prior acquisitions. Revised U.S. merger guidelines set out how the agencies should consider the impact of serial acquisitions in their assessments. The agencies have launched a public inquiry on serial acquisitions, emphasizing that PE firms engage in this strategy across a variety of industries.

U.S. takes action against Welsh Carson

In 2023, the Federal Trade Commission (FTC) lodged a groundbreaking challenge against Welsh Carson and portfolio company U.S. Anesthesia Partners (USAP). The agency alleged that the firms violated antitrust rules by engaging in an anticompetitive roll-up strategy to purchase 17 anesthesiology practices over a ten-year period, as well as setting prices and allocating markets.

In federal court, the FTC suffered a blow. Last year, a District Judge dismissed the claims against Welsh Carson. It ruled that the PE firm held only a minority (23%) interest in USAP at the time the FTC opened its investigation. The judge was not willing to expand liability to minority investors whose subsidiaries reduce competition.

Despite this loss, the FTC indicated it would pursue a second, administrative, case against Welsh Carson. Early in 2025, the FTC reached a landmark agreement with the PE firm to settle this potential action.

Welsh Carson must freeze its investment in USAP and reduce its board representation. It will have to obtain prior approval for certain future investments in anesthesia anywhere in the U.S. and give advance notice of certain deals involving hospital-based physician practices, again, nationwide. Welsh Carson must also cooperate with any future litigation, a notable commitment given that the FTC’s federal case against USAP is ongoing.

New FTC, new approach?

The Democratic commissioners heralded the Welsh Carson settlement for its novel treatment of PE defendants and its application of the 2023 merger guidelines. They said it was a blueprint for future FTC orders “involving financially sophisticated investors.”

However, Republican Commissioner Andrew Ferguson cautioned against reading too much into the case. He supported the action but said it is irrelevant that Welsh Carson was a PE company. He noted that the analysis would be the same for any individual or institutional investor.

Ferguson has since been appointed FTC chair. His comments suggest that while serial acquisitions may still feature in future FTC enforcement action, PE may not be singled out for special treatment.

Serial acquisitions under pressure outside the U.S.

Scrutiny of serial acquisitions—whether by a PE firm or a strategic buyer—continues to climb the antitrust enforcement agenda in other jurisdictions.

In 2024, a supermarket chain deal was reviewed in Brazil for a second time after concerns were raised over the PE buyer’s acquisition strategy. It was ultimately unconditionally cleared (again) but with a promise to monitor future purchases by the acquirer. The Dutch antitrust authority looked at a serial acquisition strategy for the first time (see Review risk for deals not meeting merger control thresholds for more on this case).

In Australia, the new mandatory merger control regime, applicable from January 2026, includes a threshold that catches cumulative Australian turnover from acquisitions in the same market(s) over a three-year period. These aggregated acquisitions will also be considered in the authority’s substantive assessment. Even before the new rules kick in, the Australian Competition and Consumer Commission has accepted divestment commitments in a pet retailer deal to address concerns over a number of non-notified acquisitions. It is also looking at possible creeping acquisitions by a PE firm in the insurance sector.

Consolidation in certain sectors is similarly in the spotlight.

The veterinary sector is the prime example. An ongoing market review in the U.K. includes an assessment of concentration levels. The head of the Dutch antitrust authority has warned that regulators should be particularly concerned about PE acquisitions in markets such as vets, where consumers have a high willingness to pay.

Mounting filing burden—especially for PE 

Aside from heightened antitrust enforcement risk, PE firms face increasing administrative burden when complying with merger notification requirements, even for no-issues deals.

As well as certain additional information about prior acquisitions, the new HSR filing form requires further disclosure of ownership structures. It covers relationships between affiliated or associated entities and information on limited partners who can influence decision-making post-transaction. Full compliance with these onerous requirements is vital.

Beyond merger control, the EU Foreign Subsidies Regulation is having a noticeable impact on PE investors. Latest statistics show that 50% of notifications under the regime involve an investment fund as a notifying party (see our article EU Foreign Subsidies Regulation rains down new challenges for M&A). The information gathering and disclosure requirements on PE are onerous.