Private equity bought America's essential services

Post by [deleted] » Wed, May 27, 2026, 1:22 PM UTC

lumost wrote: post #29

sega_sai wrote: post #3

I simply don't understand why leveraged buy-out(LBO) is allowed in the first place. It is like paying for the company with the money from the company you are buying.

It provides liquidity to business owners. As a business owner, if you want cash today because you are done with a business. You could go to a bank and get a loan to pay dividends. This is a bad deal for the bank as you have no incentive to operate the business after you cash out the loan. A private equity firm comes in and operates the business on the model that they still keep some of the profits after the loan valu…

Post by amazingamazing » Wed, May 27, 2026, 1:22 PM UTC

toomuchtodo wrote: post #59

amazingamazing wrote: post #44

Earlier quoted context omitted.

How will that work - for example Y Combinator classes. They cannot be acquired? What about acquihires? Cant stop that - employees have their own agency.

If the acquirer attempts to acquire a startup (regardless of investor) for anti trust reasons, or there are anti trust concerns, the M&A activity is disallowed by regulators. A recent example is Figma and Adobe. https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que...

Post by amazingamazing » Wed, May 27, 2026, 1:24 PM UTC

toomuchtodo wrote: post #64

amazingamazing wrote: post #63

Earlier quoted context omitted.

Seems vague. What is an anti trust reason? Figma and Adobe id a great example. Both are doing very poorly.

I am not an anti trust enforcer or scholar, so I'm going to defer to experts in the field: Lina Khan, Matt Stoller, etc. That is the point of experts in a domain.

Post by AndrewKemendo » Wed, May 27, 2026, 1:24 PM UTC

amazingamazing wrote: post #50

consp wrote: post #42

Earlier quoted context omitted.

> but this only works because people complain instead of starting rival business. This reads like fiction. When they corner the market it's of course trivial to just jump in and take that share. No way they will try to be disruptive to you or sue you to hell and back and of course the bank will loan you the pile of money to start a new company since there is no giant corporation to compete with who can squeeze you ou…

Your comment is the one that seems like fiction. You are saying PE is unbeatable? Per the article there is a backlog of orders. What is stopping one of the previous owners from creating another company and taking them? Sue for what exactly? Of course they will be disruptive, that is what competing means.

Post by amazingamazing » Wed, May 27, 2026, 1:25 PM UTC

DangitBobby wrote: post #56

amazingamazing wrote: post #21

Seems strange to me: 1. No one forced these people to sell. Is the idea that you can’t sell to an entity with more money? If you block that good luck with the world economy. 2. If above is ok is the idea that the new owner is inherently worse because they have more money, whereas as the smaller would be OK then where are the new entrants? 3. Going to the article it is clear enough. These industries just are not lucra…

If you own a business and wish to retire, your options are pretty much to sell, pass it on to someone, or dismantle it. I don't know how this is even a question really. Where in the article or the comment section is anyone saying they shouldn't be selling?