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Published February 2016 | Submitted
Journal Article Open

CEO Narcissism and the Takeover Process: From Private Initiation to Deal Completion


Chief executive officer (CEO) narcissism affects the takeover process. Acquirer shareholders react less favorably to a takeover announcement when the target CEO is more narcissistic. Narcissistic acquiring CEOs negotiate faster. They are also marginally more likely to initiate deals. Acquirer CEO narcissism and target CEO narcissism are associated with a lower probability of deal completion and reduce the likelihood that the target CEO will be employed by the merged firm. Our findings highlight the importance of both acquirer and target CEO psychological characteristics throughout the takeover process.

Additional Information

© 2016 Michael G. Foster School of Business, University of Washington. Published online: 23 March 2016. We are grateful to Adam Kolasinski (the referee) and Paul Malatesta (the editor) for their constructive comments. We thank Audra Boone, W. Keith Campbell, François Derrien, Matthias Kahl, Sebastien Michenaud, Christophe Pérignon, Luc Renneboog, Armin Schwienbacher, Geoffrey Tate, Karin Thorburn, Amy Wang, participants of the 2011 European Finance Association annual meeting (Stockholm), and participants of the 2012 American Finance Association annual meeting (Chicago) for their comments and suggestions.

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