What's Driving Acquisitions? An In-Depth Analysis of CEO Drivers Determining Modern Form Acquisition Strategy

Authors

Jennifer E. Wuebker, Law Clerk, United States Bankruptcy Court, Western District of Texas

Abstract

Part I provides an overview of the acquisition landscape, including

a brief history of the prevalence and success of acquisitions

as well as an analysis of acquisitions today. Part II outlines

the acquisition process and highlights the importance and dynamics

of decision making, both in principle and in practice. Part

III explores two theories of acquisitive strategy driving CEO decision

making: value enhancement and private interest. Part IV

analyzes the implications of CEO personality and psychological

drivers on acquisition strategy and decision making. This article

argues that CEO traits are central decision drivers, but that no

particular set of traits can predict or determine the viability of an

acquisition. Further, current mechanisms aimed at protecting

against CEO greed remain insufficient to prevent the consummation

of bad deals. The board of directors must understand and

systematically consider the impact of specific drivers, facing the

acquisition decision with higher scrutiny for CEOs exhibiting

multiple drivers or drivers with particular likelihood to impact

the acquisition's return on investment.

Recommended Citation

Jennifer E. Wuebker, What's Driving Acquisitions? An In-Depth Analysis of CEO Drivers Determining Modern Form Acquisition Strategy, 50 U. Rich. L. Rev. 9 (2016).
Available at: https://scholarship.richmond.edu/lawreview/vol50/iss5/4