We examine M&A transactions between firms with current board connections and show that acquirers obtain significantly higher announcement returns in such transactions. Acquirer announcement returns in transactions with a first-degree board connection where the acquirer and the target share a common director are 2.46% greater than those in non-connected transactions. Similarly, acquirer announcement returns in transactions with a second-degree board connection where one director from the acquirer and one director from the target serve on the board of a third firm are 1.62% greater than those in non-connected transactions. Our results suggest that first-degree board connections benefit acquirers by allowing them to acquire the target at a lower takeover premium. Second-degree board connections, on the other hand, benefit acquirers by resulting in greater value creation from the deal, as evidenced by greater combined acquirer and target announcement returns and better post-merger operating performance in such deals.