CEO tenure and mergers and acquisitions

Bing Zhou, Shantanu Dutta and Pengcheng Zhu

Finance Research Letters, 2020, vol. 34, issue C

Abstract: In this study, we examine the relationship between CEO tenure and corporate mergers and acquisitions (M&A) performance. Using a large sample of 16,516 M&As in the United States between 1999 and 2015, we find that long-tenured CEOs tend to create more shareholder value than short-tenured CEOs in M&A deals. We also find that long-tenured CEOs are more likely to acquire private target firms and to make acquisitions in the same industries and the domestic market. Finally, we find that long-tenured CEOs receive higher compensation compared to the pre-acquisition period if they make better acquisitions.

Keywords: CEO tenure; Mergers and acquisitions; Performance; Event study (search for similar items in EconPapers)
JEL-codes: G34 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:34:y:2020:i:c:s1544612319301618

DOI: 10.1016/j.frl.2019.08.025

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