"Known as a “roll-up”, it involves buying large numbers of smaller or independent businesses using debt, and merging them into a large group that can cut costs with economies of scale. Rival buyout groups have snapped up dental surgeries and petrol stations in a similar way. The model rests, in part, on a piece of financial engineering known as “multiple arbitrage”, in which buyout groups calculate that the price they pay for a small business, per dollar of its earnings, is lower than the price they can later receive for it as part of a bigger group...One vet in southern England says the price of Metacam, a widely dispensed anti-inflammatory painkiller, rose at their practice by 28 per cent to £82.79 for a 100ml bottle after IVC took over."
