This study examines how performance feedback and organizational slack of the acquiring firm affect technological overlap between the target and acquiring firms based on the behavior theory of the firm. Specifically, we theorize that technological overlap between the acquiring and target firms decreases with the distance of acquiring firms past performance below aspirations, whereas the technological overlap increases with the distance of acquiring firms past performance above aspirations. Also, we hypothesize that technological overlap between the target and acquiring firms increases with acquiring firms financial slack resources. Lastly, we examine the interaction effect of performance feedback and financial slack. We suggest that the interaction effect of performance below aspirations and abundant financial slack and that of performance above aspirations and low financial slack is stronger compared to the circumstance when these two factors force the acquirer to choose targets with contradicting charact...