Washington – In response to the Federal Trade Commission and Department of Justice’s joint request for information on corporate consolidation through serial acquisitions and roll-up strategies, the Computer & Communications Industry Association offered comments today.
CCIA appreciates the Agencies’ efforts to gather information and learn more about the important role that mergers play in the economy. However, CCIA’s comments caution that without a clear definition of “roll-up strategies” and “serial acquisitions,” there is a risk of misinterpreting these transactions and their competitive nature, alleging competitive harm where there might not be any.
Additionally, CCIA encourages the Agencies to fully consider both the procompetitive and anticompetitive effects of such transactions. CCIA’s comments note that acquisitions account for over 66 percent of exits by startups, and how overdeterrence of acquisitions would severely affect startup success and hinder innovation, resulting in over 80 percent of startups failing.
CCIA has advocated for a competitive tech industry for more than 50 years.
The following can be attributed to CCIA Vice President of Global Competition and Regulatory Policy Krisztian Katona:
“We appreciate the agencies’ efforts to study the competitive dynamics of serial acquisitions and roll-up strategies in the U.S. economy, though the RFI seems to focus solely on the anticompetitive risks of these transactions. An objective analysis of both their competitive and anticompetitive aspects is necessary to gain a comprehensive understanding of the dynamics of mergers and acquisitions in various industries and the broader economy. Acquisitions drive the startup ecosystem and are an important exit strategy for startups to recoup their investments.”