DO THEY WALK THE TALK? GAUGING ACQUIRING CEO AND DIRECTOR CONFIDENCE IN THE VALUE CREATION POTENTIAL OF ANNOUNCED ACQUISITIONS

被引:53
作者
Devers, Cynthia E. [1 ]
McNamara, Gerry [1 ]
Haleblian, Jerayr [2 ]
Yoder, Michele E. [3 ]
机构
[1] Michigan State Univ, Broad Coll Business, E Lansing, MI 48824 USA
[2] Univ Georgia, Terry Coll Business, Athens, GA 30602 USA
[3] Univ Michigan Dearborn, Dearborn, MI USA
关键词
EARLY-MOVER ADVANTAGES; EXECUTIVE-COMPENSATION; FIRM PERFORMANCE; POSTACQUISITION PERFORMANCE; AGENCY COSTS; RISK-TAKING; STOCK; INFORMATION; MANAGEMENT; MERGER;
D O I
10.5465/amj.2011.0555
中图分类号
F [经济];
学科分类号
02 ;
摘要
We explore whether acquiring CEOs and directors act consistently with the idea that their newly announced acquisitions will increase long-term firm; value. Specifically, we examine postannouncement adjustments to CEOs' equity-based holdings and find acquiring CEOs tend to exercise options and sell firm stock following acquisition announcements. Moreover, positive short-term market performance exacerbates this effect. Further, we find directors tend to grant their acquiring CEOs stock options, after acquisition announcement, presumably to more tightly align CEO-shareholder interests. These findings suggest that when CEOs and directors manage acquiring CEOs' equity-based holdings, they do not appear to anticipate long-term value creation from their acquisitions.
引用
收藏
页码:1679 / 1702
页数:24
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