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FTC acts against private equity firm’s acquisition of veterinary clinics

ftc.gov

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Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#81

Post by jrochkind1 »

ensignavenger wrote: post #55
AlotOfReading wrote: post #21

Earlier quoted context omitted.

My partner works in this industry and in fact has friends that are affected by this merger. While the FTC can and does have the ability to do many things simultaneously, the current situation in the vet industry is dire . Corporate vets are more profitable (through price-gouging), have a virtual stranglehold on increasingly limited labor pools, and are pretty much the only ones that can afford to invest in specialty…

Could you explain this more? If the corp vets are price gouging, why are consumers choosing them over the smaller vets?

I go to a smaller vet with good prices and good care. They are not currently taking new customers/patients.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#82

Post by shakes_mcjunkie »

PragmaticPulp wrote: post #61

Vet clinics became very popular private equity targets recently. One of the people I know in PE described their profit margins as being surprisingly high even before PE roll-ups. They said that some PE firms were on a mission to acquire all of the vet firms in metro areas and then drive prices up even further because the demand is so inelastic. There was a secondary rush where people were trying to acquire vet clinic…

> They said that some PE firms were on a mission to acquire all of the vet firms in metro areas and then drive prices up even further because the demand is so inelastic.

I searched recently for a nearby vet in Chicago and probably out of 15, only 1 was not owned by a larger chain or company. Big bummer. It's hard to trust that a vet that's part of a chain isn't going to have perverse incentives when it comes to caring for my pets.

Also, another thing that I imagine is driving up vet prices is the unregulated pet insurance industry.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#83

Post by Johnny555 »

PragmaticPulp wrote: post #61

Vet clinics became very popular private equity targets recently. One of the people I know in PE described their profit margins as being surprisingly high even before PE roll-ups. They said that some PE firms were on a mission to acquire all of the vet firms in metro areas and then drive prices up even further because the demand is so inelastic. There was a secondary rush where people were trying to acquire vet clinic…

Vet clinics become very popular private equity targets recently.

Probably because more and more people are buying pet insurance -- our insurance paid nearly $20,000 to Sage for my dog's cancer treatments. I doubt I could afford emergency vet treatments without insurance.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#84

Post by banannaise »

legitster wrote: post #67
PragmaticPulp wrote: post #61

Vet clinics became very popular private equity targets recently. One of the people I know in PE described their profit margins as being surprisingly high even before PE roll-ups. They said that some PE firms were on a mission to acquire all of the vet firms in metro areas and then drive prices up even further because the demand is so inelastic. There was a secondary rush where people were trying to acquire vet clinic…

I worked with people who did (human) clinic roll ups. Part of the issue at hand is that doctors and physicians are notoriously bad businesspeople. So once they build up a big enough practice, a lot of them will jump on the chance to sell the side of the business that they hate to a management firm.

The inevitable march of capitalism: experts in every field are gradually relieved of their decision-making power by experts in finance, until finance guys control everything.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#85

Post by bombcar »

mywittyname wrote: post #10
riahi wrote: post #8

Earlier quoted context omitted.

See luxottica and their “brands”.

They even own the insurance company, EyeMed...

I honestly think at some point this gets to the place of "operating under false pretences" to have so many brands that are actually the same company behind it.

Perhaps "brought to you by HOLDING_COMPANY_X" should be required.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#86

Post by legitster »

jessaustin wrote: post #78
legitster wrote: post #57

Earlier quoted context omitted.

A bit of apples and oranges here. The goal of the FTC is not to make big companies smaller, it's to protect the market. They are not supposed to be the ones to determine if whales are natural or not to an ecosystem - so they don't generally go hunting them.

That's so 1980s. Your appeal to nature has nothing to do with the reality of the last several decades. Mergers among firms in the same market are never good for humans who must use those markets in order to live.

> Mergers among firms in the same market are never good for humans who must use those markets in order to live.

I don't think this is a universal truth. Clearly there are situations where consumers prefer national brands or dealing with larger companies. If we don't like it, we can pass laws to impose our morality on the public, but the FTC has their mandate and they are sticking with it until told otherwise.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#88

Post by bombcar »

colinmhayes wrote: post #56
samstave wrote: post #52

Earlier quoted context omitted.

BlackStone Vangauard Etc. There have been COUNTLESS videos about the above and how much they own. These are the monopolies we should be going after.

Index funds almost never vote with their shares. To say that vanguard having equity ownership without utilizing their voting rights leads to market failures seems incredibly naive.

Bogle of Vanguard fame actually warned against the problem that Vanguard and Vanguard like things could cause: http://johncbogle.com/wordpress/wp-content/uploads/2019/08/n...

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#89

Post by eatsyourtacos »

ensignavenger wrote: post #55
AlotOfReading wrote: post #21

Earlier quoted context omitted.

My partner works in this industry and in fact has friends that are affected by this merger. While the FTC can and does have the ability to do many things simultaneously, the current situation in the vet industry is dire . Corporate vets are more profitable (through price-gouging), have a virtual stranglehold on increasingly limited labor pools, and are pretty much the only ones that can afford to invest in specialty…

Could you explain this more? If the corp vets are price gouging, why are consumers choosing them over the smaller vets?

>why are consumers choosing them

It's interesting that most people who like to defend the free market act as if consumers actually have choices most of the time.

That's just simply not the case nearly all the time.. or it's a complete illusion of choice.

Especially in any rural/smaller suburban area (of which the US predominantly is). It's not as if you have 1000 choices for everything around. That's only in large urban areas. The US is so spread out that it can't cram tons of competition in most of it's areas. And that is probably what is being exploited here.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#90

Post by bombcar »

markovbot wrote: post #69
Freebytes wrote: post #35

Earlier quoted context omitted.

Emergency vets in many places will demand you pay $5,000 upfront (within minutes before surgery is performed) or your pet dies. Then, your pet will die anyway. It is a sad and exploitative industry.

> It is a sad and exploitative industry. just wait till you see what they do with human healthcare in this country

There they don't even ask, they just start treating, because they know that the emergency costs will be borne by someone.
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