Who usually gains the most in a merger?

Question

Quizplus · Accepted Answer

In a merger, the target firm's shareholders usually gain the most because they receive payment for their shares at a premium price. The acquiring firm's shareholders may see a short-term increase in stock price, but in the long-term, the success of the merger is not guaranteed and may result in a decrease in value. The acquiring firm's management may benefit from the merger in terms of expanded operations and increased market share, but this does not necessarily translate to financial gain for them personally. The target firm's management may also benefit from the merger, but their gains are typically tied to retention bonuses and stock options rather than payment for their shares.

Who Usually Gains the Most in a Merger