Chapter 7

Before the Merger: Merger Motivations and Objectives

Our company was “put into play” by a hostile bidder. We were finally acquired by a friendly “White Knight.” It was important to the acquirer to be perceived as honorable and all employment contracts and benefits were scrupulously honored.

However, they knew nothing about operating our business. They needed to retain our key people, despite strong incentives for many of our top executives to leave. Our top executives had vested employment contracts for lucrative “golden parachute” payments if we were acquired.I stayed because I felt I was needed, there was plenty to do, I was well paid, and my welfare was considered by the new executive team.

—Top executive who decided to stay on ...

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