Title: Psychological effects of mergers and acquisition on employees: case study of some selected banks in Nigeria

Authors: Olubukunola R. Olatunji, Uwuigbe Uwalomwa

Addresses: Department of Accounting, College of Business & Social Sciences, Covenant University, Ota, Ogun State, Nigeria. ' Department of Accounting, College of Business & Social Sciences, Covenant University, Ota, Ogun State, Nigeria

Abstract: Mergers and acquisitions have had a significant impact on the banking industry in Nigeria and around the world, over the last decade. As a result, many bank employees have experienced numerous psychological effects of mergers and acquisition. Acquisition is often seen to have negative impacts on employee|s behaviour, resulting in counter productive practices, absenteeism, low morale and job dissatisfaction. This paper studied the effects of merger and acquisition on the morale and psychology of employees in the Nigerian banking sector and how it affects employee|s productivity. It identified the different stages in mergers and acquisition and also the problems that may emerge at each stage of mergers and acquisition integration process. The paper observed that various factors relate to pre and post mergers and acquisition stages among which communication seems to be the most vital. The paper therefore suggests that open, timely, and accurate communication with employees may effectively reduce the negative psychological and behavioural consequences, thereby reducing employee|s anxiety, uncertainty, confusion, rumour activity and labour turnover.

Keywords: psychological effects; mergers and acquisitions; M&A; bank employees; banks; productivity; Nigeria; banking industry; employee behaviour; employee morale; communication.

DOI: 10.1504/WREMSD.2009.021703

World Review of Entrepreneurship, Management and Sustainable Development, 2009 Vol.5 No.1, pp.102 - 115

Available online: 30 Nov 2008 *

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