Key Takeaways
- • WSPA 7News' investigation describes "stealth consolidation," in which national investment firms acquire local companies, often keeping the original family business name, which experts say reduces competition, cuts jobs and raises consumer prices.
- • A Greenville homeowner received a $48,000 roofing quote, roughly $35,000 above her insurance coverage, and later found a local company that quoted $11,000 for the same work.
- • Local roofers Brian Gilstrap and John Roberson said they have been approached by firms seeking to buy their businesses and declined; Gilstrap cited a $70,000 quote on a job he estimated at about $30,000.
- • Eileen Appelbaum, Co-Director of the Center for Economic and Policy Research, says consolidation extends from hospitals and doctors' offices to funeral homes, HVAC, plumbing and pest control.
- • The FTC's 2024 "Slow the Roll-Up" report says it has challenged serial acquisitions in anesthesiology, veterinary and dialysis clinics, while South Carolina does not require private equity owners to register with the state.
Summary
WSPA 7News' "7NEWS Here to Help" investigation examines a trend experts call "stealth consolidation," in which national investment firms buy local companies and, in many cases, keep the original family business name. According to the report, the practice can deplete competition, cut jobs and leave consumers paying more, and the station presents it as a possible contributor to price increases beyond general inflation.
The report illustrates the issue with consumer experiences in the Upstate. Teresa Harris of Greenville received a $48,000 roofing quote from a company that offered financing at about $450 for 15 years; the quote was $35,000 more than her insurance would cover. Jon Meyer of Easley found a local roofer with a bid $6,000 to $7,000 lower than a larger company's quote. Harris ultimately hired a local firm that quoted $11,000.
Local operators describe similar pressures. John Roberson, whose family roofing business has operated since 1965, said he has noticed new players entering the area over the past year. Brian Gilstrap, a fourth-generation Upstate roofer, cited a job he said was worth about $30,000 for which a competitor quoted $70,000. Both said they have been approached by firms seeking to buy their companies and both declined. Gilstrap also said acquiring investment and private equity firms have been known to cut jobs.
Eileen Appelbaum, Co-Director of the Center for Economic and Policy Research and author of "Private Equity at Work: When Wall Street Manages Main Street," said the trend began with hospitals, doctors' offices and ambulance services and has broadened to funeral homes, cemeteries, HVAC, plumbing and pest control. She said that once a buyer dominates a local market, consumers lack alternatives and prices can rise. The station also reported that consumers in Greenville and Simpsonville said prices rose after a fencing company and a pest control company were acquired by larger firms.
The Federal Trade Commission has described the pattern as "serial acquisitions," in which investors buy small competitors in a region. Its 2024 report "Slow the Roll-Up" said the agency has challenged such deals involving anesthesiology practices, veterinary clinics and dialysis clinics. The article notes that not all private equity acquisitions raise prices and that buying businesses is not illegal. It also says South Carolina does not require private equity firms to register as new owners, although some states have transparency laws, and that residents can check ownership through the Secretary of State's Business Name Search and Delaware's registry, where many private equity firms are registered.
The report illustrates the issue with consumer experiences in the Upstate. Teresa Harris of Greenville received a $48,000 roofing quote from a company that offered financing at about $450 for 15 years; the quote was $35,000 more than her insurance would cover. Jon Meyer of Easley found a local roofer with a bid $6,000 to $7,000 lower than a larger company's quote. Harris ultimately hired a local firm that quoted $11,000.
Local operators describe similar pressures. John Roberson, whose family roofing business has operated since 1965, said he has noticed new players entering the area over the past year. Brian Gilstrap, a fourth-generation Upstate roofer, cited a job he said was worth about $30,000 for which a competitor quoted $70,000. Both said they have been approached by firms seeking to buy their companies and both declined. Gilstrap also said acquiring investment and private equity firms have been known to cut jobs.
Eileen Appelbaum, Co-Director of the Center for Economic and Policy Research and author of "Private Equity at Work: When Wall Street Manages Main Street," said the trend began with hospitals, doctors' offices and ambulance services and has broadened to funeral homes, cemeteries, HVAC, plumbing and pest control. She said that once a buyer dominates a local market, consumers lack alternatives and prices can rise. The station also reported that consumers in Greenville and Simpsonville said prices rose after a fencing company and a pest control company were acquired by larger firms.
The Federal Trade Commission has described the pattern as "serial acquisitions," in which investors buy small competitors in a region. Its 2024 report "Slow the Roll-Up" said the agency has challenged such deals involving anesthesiology practices, veterinary clinics and dialysis clinics. The article notes that not all private equity acquisitions raise prices and that buying businesses is not illegal. It also says South Carolina does not require private equity firms to register as new owners, although some states have transparency laws, and that residents can check ownership through the Secretary of State's Business Name Search and Delaware's registry, where many private equity firms are registered.
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