| Summary: | The increasing frequency and deal size of mergers and acquisitions (M&A) in market contradict the general agreement that a large proportion of M&A fail to benefit shareholders of acquiring firms. The reasons of taking M&A for companies can be complex, but it is possible that people factor risk the success of M&A from the beginning. As CEO compensation considered to be a force for CEOs to make effort to engage their companies to M&A, failure of M&A to some extent depends on perceptual factor.
To explore the potential link between M&A motive and M&A failure, also inspired by the research of Harford and Li (2007) on CEO compensation, then in this article, research is launched following the clue of thought that M&A motives, M&A failure determinants and CEO compensation are progressively related. Consequently, the whole research analyse the research objective combining literal and empirical methods. The final result suggests certain degree of possibility for CEOs to take M&A action perceptually and M&A activity may fated to fail.
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