Why Some CFOs Make Better M&A Deals
When chief financial officers have greater influence in the C-suite, companies are far less likely to destroy value by overpaying for acquisitions.
The Research
We conducted a large-scale empirical investigation to answer the following question: Which sources of CFO power enable companies to pay lower acquisition premiums?
Our sample included 1,983 acquisition deals that were conducted by 926 U.S. public companies between 1992 and 2019 and recorded in the Securities Data Company Platinum database. The acquisition premium was calculated as the acquisition price per share divided by the target firm’s closing market price on the day before the acquisition announcement. ...
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