Golden parachute

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  • #36339
    Ahmed Zainalabedin

    There are a lot of controversies around golden parachute, where management receive large payments if fired following an acquisition. What is your view on this? Should such payments be illegal at least if it is a result of an M&A deal?

    Mohammed Jazzaa

    in my opinion this a complex problem and it should be assessed as part of the acquirer due diligence process. furthermore, the acquirer should also think about the level of integration they want to achieve to identify if there are plans to fire executives of the target company. and based on my reading such tactics from target companies execs are usually put in place as a mitigation measure against hostile takeover.

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