The buying and selling of organizations has become a frequent experience among American businesses in recent years. Despite widespread merger and acquisition activity, little empirical research exists exploring the processes involved and the factors contributing to ultimate success or failure of these unions. The body of literature concerning mergers and acquisitions, while extensive, lacks theoretical models describing organizational dynamics occurring during the m/a process.; The present effort provided a review of the current body of literature addressing the psychological aspects of mergers and acquisitions, uncovering common themes. Two similar models of m/a variables believed to influence parent and target member evaluations of ultimate m/a outcomes were proposed. It was hypothesized that parent and target firms perceived m/a processes and outcomes differently, based on their position in the business relationship and the degree of hostility present during the m/a negotiation. The proposed models were tested using hierarchical multiple regression and support was found for a negative hostility-morale relationship among target member evaluations.; Survey data were obtained from 76 publically traded, U.S. firms (40 parent, 36 target) that had participated in m/as during the 1982-1983 time frame. Surveys were completed by senior executives (i.e., CEOs, senior managers, human resource managers) from both parent and target firms. Support was found for a difference among parent and target member evaluations of post-m/a moral among target employees, with targets reporting lower morale than parents, but not in evaluations of overall m/a success. No interaction was found between pre-m/a organizational affiliation and hostility in influencing m/a outcomes.
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