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CEO Influence: Examples of Style

If, in fact, M&A activity is related to poor subsequent stock performance, executives should seek fewer deals than they do. More important, it is counter-intuitive that executives get financially rewarded for pursuing transactions that in the long run reduce stakeholder value. In a few high-profile transactions like, for example, Travelers Group and Citigroup, senior executives sold their firms to rivals, pocketing an enormous windfall as they walked away.25 Many subordinates would be later fired or pushed out in the consolidation and often the combined entity would not reap the projected advantages of synergy. Given these obvious potential conflicts of interest, shouldn't compensation programs address these potentially disastrous developments?

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