The market for mergers and acquisitions (M&As) is growing steadily, yet scholars claim that acquisitions can destroy a firm’s value and reduce operating performance (King, Dalton, Daily, & Covin, 2004). Many researchers argue that top managers have personal motives to undertake M&As that can jeopardize the shareholders’ gains (Morck, Shleifer, & Vishny, 1990). However, research has also demonstrated that managerial ownership of the firm tends to restrain managers from acting in their personal best interests (Datta, Iskandar‐Datta, & Raman, 2001; Bliss & Rosen, 2001). Higher compensation that CEOs receive after an acquisition and the reduction of the job-related risks by diversification into unrelated businesses are often cited as factors that lead to top managers’ decision to undertake M&As (Harford & Li, 2007; Amihud & Lev, 1981). Despite such advances of knowledge in the current literature on M&As, it is still unclear how CEO motivations for an M&A are linked to post-acquisition underperformance of a target. To address this gap in the literature, this study examines the impact of self-serving motivations of top managers to undertake an M&A on the post-merger operating performance of a target firm. This study also investigates how CEO ownership affects the post-merger target performance. The results show that, on average, an increase in the total yearly compensation to CEOs does not have a significant impact on target performance one year after deal completion. Thus, large rewards granted to CEOs after M&As may not motivate them to achieve higher profits one year post-merger. Acquisition of an unrelated target, on the other hand, has a positive effect on target performance following a merger. This result provides evidence that CEO motives to diversify personal risks with an acquisition of unrelated targets do not impede post-acquisition profits. Findings also suggest that CEO stock ownership does not improve the post-merger operating performance of targets, mainly due to the very small equity stakes owned by CEOs (1.75% on average). This study contributes to the existing literature on the role of CEOs in understanding the post-M&A performance.