I think what you're looking for are BDCs and yes there a ton of them and the big boys play in in that pool band like Ares

Thanks Jay. I had in mind holding companies that exclusively take 100% (or nearly 100%) equity interests in smaller niche companies whereas BDCs tend to primarily invest in debt securities to prioritize dividend income (at least that's my perceived generalization), but it's an area that probably deserves another look on my part. Good suggestion.

Hi David,

Constellation Software are probably the most well know. They look to acquire small software companies across industry verticals.

XPO Logistics are another good case study. They’ve done a well executed roll up of third party logistics.

Finally, check out Danaher Group. They deploy the Danaher operating system across product centric science and technology companies. It’s a great story.

David - You're correct about most of the BDCs, with the potential exception of one of the Gladstone entities (MAIN). I'm not aware of any companies exactly as you've described, but you're probably looking for names like BOHM (Boston Omaha), or EFSH[redacted]Holdings)... there is another publicly-traded firm focused on lower middle market buyouts (maybe based in Texas) whose name is escaping me...

David - might be a bit too far away from home for you but you could take a look at a European public company called Bavaria Industries Group AG that does small PE investments (www.baikap.de).

Check out Indutrade: https://www.goldsoutheast.com/post/indutrade-a-nordic-role-model-for-smb-acquisitions-in-japan

This may be very obvious and known to you, but Heico and TransDigm are a couple poster childs of that strategy.

I’m (mostly) a Microcap investor who has met 1:1 with 1,000+ Microcap CEOs over the last 10 years. Here are a few with acquisitive history: XPEL (XPEL) buys PPF installers, Hamilton Thorne (HTL.V) buys IVF equipment, Nova Leap (NLH.V) buys dementia care, Atlas (AEP.V) buys truss mfgs, Where Food Comes From (WFCF) buys ag auditors, Cematrix (CVX.V) buys cellular concrete mfgs, Schmitt Industries (SMIT) just bot an ice cream brand, etc. Want more?

Almost every industry has some companies that act as acquisition platforms. Any company that talks a lot about inorganic growth is a good place to look. Alternatively, if you have access to Bloomberg or some other similar terminal, you can look at how much Cash for Acq of Subs vs. CFO over a 5 or 10 year period. Serial acquirers will have used a large portion of their cash generated to acquire other companies (using this method you could also screen a certain market cap or industry as well).

interesting post. Would say emerging markets where no antitrust law are a good place to look

I've just started working with one now. They acquired a listed shell and want to purchase my target business in exchange for shares in listed shell. They have numerous projects. Just signed NDA, awaiting further info. Works in theory, quality of execution will determine outcome.

depends on your definition of "micro" - many publicly traded PE firms regularly do this with $50M topline as the lower end of micro. For those with the privilege of lots of capital to deploy, it's a lot easier to do with amplitude than frequency

Thanks everybody. I've heard of many of the names mentioned here, but some were new to me. Appreciate the suggestions.