for target shareholders because of the potential conflict of interest of the CEO, it is also possible that target … shareholders could benefit from CEO retention because it can increase the performance of the acquired firm and, consequently … harms shareholders in acquisitions involving private equity firms. In fact, we show that better performing target CEOs are …

behalf of the target shareholders. Our empirical evidence is not consistent with this belief. We find that, when a private … equity acquirer retains the target CEO, target shareholders receive an acquisition premium that is larger by as much as 18 … than other potential CEOs, we expect target shareholders to receive a larger premium because the post-acquisition value of …