Mergers and Acquisitions Turmoil in Top Management Teams

Mergers and acquisitions (M&As) can be tumultuous for executives. Target companies can expect to lose close to 40% of their top management teams within 2 years after an acquisition. Executives who stay often lose status and autonomy and view their company’s acquisition as detrimental to themselves, both personally and professionally. It is common for acquiring ? rms to replace target executives with their own shortly after an acquisition. Existing research, however, suggests that doing so leads to lower target company performance. Why, then, are acquiring ? rms so quick to replace target company executives after an acquisition? Mergers and Acquisitions: Turmoil in Top Management Teams gives executives an in-depth look at the consequences of M&As for acquired top management teams. It examines M&As as a corporate growth strategy, the importance of top management teams to a ? rm’s long-term performance, the reasons why executives depart after an acquisition, and the effects of these departures on target company performance. It then discusses when executive turnover may be desirable or undesirable and how acquiring ? rms can more effectively manage target company executive teams during the integration process. An understanding of these leadership issues may play an important role in determining merger success. Keywords Mergers and acquisitions, top management teams, executive leadership, executive turnover, cross-border acquisition