ABSTRACT
This chapter focuses on the external and internal context using a stakeholder perspective of acquisitions. Understanding stakeholder impacts from an acquisition has gained increased appreciation in achieving. Awareness of employee concerns during acquisitions can mitigate conflict and employee resistance by demonstrating a commitment to employees and establishing mutual understanding. Competitors can take other actions to reduce the benefits from making an acquisition, including lowering prices and stealing customers. While advisors can offer important insights and managerial resources during several acquisition phases, an overriding consideration involves the need to use objective advisors, as advisors may be motivated to complete a deal or display conflicts of interest. Announcements of government reviews of an acquisition are associated with a negative market reaction and forced divestment of units can lower combined firm performance, as US regulators demand changes in the majority of deals reviewed. There are concerns that competitors can benefit from acquirers communicating too much about an acquisition and its integration.
