Most acquisition-led industry consolidation ('roll-up') theses are predicated on majority ownership stakes###-###-#### % buyouts) of acquired companies in order to maintain the control needed to drive top- and/or bottom-line synergies, implement best practices across the acquired businesses, change management, set compensation, etc.
At the same time, many business owners who aren't at retirement age don't want to sell a majority of the equity in their business. Has anyone seen a roll-up that was comprised of 30-49% ownership stakes in businesses where the founder rolls 51-70% into the NewCo (roll-up entity) and cedes 100% voting control to the acquirer/NewCo?
Everyone's familiar with the roll-up/consolidators of dental, HVAC, fire protection services businesses, but it strikes me that this alternative offering might be extremely differentiated in those respective markets (and other industries undergoing consolidation too). It benefits the founder that wants to monetize a small portion of their business but retain economic upside and bet on themselves, while also giving them the potential benefit of significant multiple arbitrage when the NewCo acquisition entity is sold in the future. It also benefits the sponsor because he/she retains all the control rights associated with governance/voting decisions, while at the same time ensuring that the founders that just want to retire or cash out and lose motivation self-select out of this offering.
I'm sure there are reasons I haven't seen this in the past but it strikes me as a uniquely aligned offering for investors and business owners, and quite different from other roll-up strategies in the market. Would love any thoughts or criticisms anyone can share! This is more of a thought experiment than anything else.
Oddball roll-up
![](https://55550cf88fb9105859d2-ecc273435fde99d2e690dfef78341117.ssl.cf5.rackcdn.com/img/defaultprofile.png)
by an investor from Boston College - Wallace E. Carroll School of Management
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