32 Pages Posted: 24 Jul 2000
Date Written: June 2000
We study benefits received by target company CEOs in completed mergers and acquisitions. These executives obtain wealth increases with a median of $4 to $5 million and a mean of $8 to $11 million, roughly in line with the permanent income streams that they sacrifice. CEOs receive lower financial gains from those transactions in which they become executives of the buyer, suggesting that tradeoffs exist between the financial and career-related benefits they extract. Regression estimates suggest that target shareholders receive lower acquisition premia in transactions that involve extraordinary personal treatment of the CEO.
Keywords: Takeovers, acquisitions
JEL Classification: G34, J44
Suggested Citation: Suggested Citation
Hartzell, Jay C. and Ofek, Eli and Yermack, David, What's in it for Me? Personal Benefits Obtained by CEOS Whose Firms are Acquired (June 2000). Presented at Tuck-JFE Contemporary Corporate Governance Conference. Available at SSRN: https://ssrn.com/abstract=236094 or http://dx.doi.org/10.2139/ssrn.236094