This study investigates the employment consequences of private equity acquisitions, in particular institutional buy-outs (IBOs), in the UK. It involves a pre- and post-acquisition analysis of employment and performance characteristics for a...Read more
If management has high private benefits and a small equity stake, managers and workers are natural allies against takeover threats. Two forces are at play. First, managers can transform employees into a “shark repellent” through long-term labor...Read more
Extending the theories of employee incentives and inalienability of human capital, we investigate the link between a firm‘s engagement in employee relations and the returns to shareholders around mergers and acquisitions (M&As). Using firm-level data on employee-engagement in an international sample of 4,565 M&A deals from 48 countries, we find that an acquirer‘s employee-engagement – especially in terms of monetary incentives – is positively related to shareholder returns in domestic deals, but this relationship turns negative in cross-border deals.