The researchers tested this theory by analyzing every large acquisition ($100 million or more) conducted in the public markets during a two-year period, a sample that contained 106 transactions. What they wanted to see was whether the price paid in the acquisition was influenced by three particular factors, all of which would tend to inflate the ego of the acquiring CEO: Praise by the media Strong recent corporate performance (which the CEO could interpret as evidence of his/her genius) A sense of self-importance (which was measured, cleverly, by looking at the gap between the CEO’s
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