Rule one of Barron’s 10 Rules for Investors says, “The success of a company is dependent nine parts on management and one part on all other factors, including luck.”

If that’s true for companies in general, it is particularly true for firms that are being merged or acquired.  As far back as the conglomerate period of the go-go 1960s, Leighton and Tod affirmed this belief in a Harvard Business Review article.  They wrote:

We cannot overestimate the importance of getting to know the president and his key personnel.  Evidence indicates that the more fully the parent company understands their emotional and personal needs, their weaknesses and strengths, their fears and apprehensions, the more effectively it will be able to help with the acquisition and to manage the company later on.

Ten pressing questions desperately need to be answered:

  1. Who should stay?
  2. Who should go?
  3. Who shall decide, and how?
  4. What new managerial demands will a merger bring about ...