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We highlight a largely unstudied phenomenon that affects postacquisition performance: nested acquisitions. Nested acquisitions occur when a firm acquires a target firm that has itself recently acquired another firm. In our study of publicly traded U.S. acquirers and targets from 2000 to 2014, we theorize that nested acquirers face unique integration difficulties that reduce acquirer postacquisition performance. Specifically, we build on Penrosian logic and theorize that nested acquisitions tax the managerial capacity of the acquiring and acquired firms more than nonnested ones and that, as nested acquisition complexity increases due to variance within the embedded nested targets (i.e., greater number, more recent, less related, and larger nested targets), the drain on managerial capacity also increases. Ultimately, these challenges increase the likelihood of reduced postacquisition performance. Given these …