Assertion: Board room split is one of the reasons for failure of mergers and acquisitions.
Reasoning: Managers or directors who are suddenly deprived of authority can be particularly bitter in case of merger which may prove to be a major problem, slowing down or preventing integration of the entities..
Reasoning: Managers or directors who are suddenly deprived of authority can be particularly bitter in case of merger which may prove to be a major problem, slowing down or preventing integration of the entities..
Answer & explanation
Correct answer: option 1
Boardroom split :When a merger is planned, it is crucial to evaluate the composition of the boardroom and compatibility of the directors. Managers or directors who are suddenly deprived of authority can be particularly bitter. Specific personality clashes between executives in the two companies are also very common. This may prove to be a major problem, slowing down or preventing integration of the entities.