This thesis contends that a corporate merger, on the scale of a global order, is a 'catastrophic change' and depends on 'killing off' parts of the former organisations for its success. The act of annihilating parts of the former organisations is experienced as disengaged and murderous by organisational members. This arouses persecutory anxiety of an unbearable intensity amongst members from which they defend themselves by emotionally disconnecting from the psychic reality of the organisation. Several contentions underpin the hypothesis: 1. that a merger involves a developmental process in the creation and growth of a new organisation; 2. the event of a merger causes disruptions to roles and relationships that are experienced as a loss of power, status and identity, and also as an emotional loss for what had been cherished and valued in the former organisation/s; 3. the emotional loss evokes the symbolic experience of the loss of a 'loved object', and an instinctual loss becomes attached thereby to the real losses; and thus, 4. the process of merger involves a symbolic destruction of the 'loved organisational object' of the former organisations, as held in the minds of organisational members. The thesis is based on case study research conducted on the topic of emotional connectedness in a network organisation over a three year period. Fieldwork began at the time when the participating firm had just formed from a global merger of two large global enterprises. The Australia-New Zealand regional operations were the focus of the study. The research discovered a significant degree of emotional disconnectedness due to: 1. the nature of the work that required staff to work on client sites, away from home and often alone; 2. a multiplicity of organisational structures that engendered fragmentary connections; 3. valuing individuals' self-reliance over and above the interdependence of organisational members; 4. the many external changes experienced by the firm from the effects of the merger and from market economics, political and business turmoil, and for the Australia- New Zealand operations, a shift in the location of their corporate head office from North America to Europe; 5. increasing uncertainty within the industry, and a commensurate increase in competitiveness; 6. a loss of profitability in the Asia-Pacific region in which the case study participants were located; 7. the turnover in the regional director's role, with three appointments in less than two years; 8. dramatic rises and falls in staff numbers, ranging from an initial 450, to a high of 750, and sudden decline to 120 people during the period of the study; 9. the reluctance of vice-presidents and directors to take up a corporate management role, preferring to work as 'project managers' on client assignments; and 10. all these factors contributing to an anxiety about the future of the Australia-New Zealand (A-NZ) operations which was expressed as a fear of survival. In response to these many factors, staff and management felt vulnerable and insecure, experiencing the merger as an annihilation of 'loved objects'. These included the loss of a partner's autonomy and ownership in the firm, familiar work procedures, and the loss of belonging to a partner's work group and associated long-term relationships. The emotional aspects of dealing with these losses and feelings were placed upon individuals to manage for themselves. The burden of ensuring the survival of the firm was displaced upon individuals, such that consultants became not only the 'container for work', but also the 'container for the organisation's survival'. As the merger progressed and more changes to the business were implemented with little to no containment of people's felt experiences, the psychic reality of the A-NZ operations became saturated with persecutory anxiety. In some parts of these operations, the anxiety became so great that group interactions (what there were of them) seemed psychotic. Those in management roles displayed a level of anxiety that appeared to be unbearable for the individuals concerned, and which resulted at times in manic responses to the human and commercial needs of the business. Bion's theories of catastrophic change and emotional links, and Klein's theories on persecutory and depressive anxieties are applied to understanding the systems psychodynamics of the effects of the merger upon the organisation. The case reveals the presence of persecutory anxiety in the immediate aftermath of the merger, lasting for nearly three years. Various social defence mechanisms are identified as being used by organisational members against this anxiety. They are: the co-existence of multiple organisational structures; a sentient sub-system of 'counselling families'; idealisation of autonomous individuals; plus, the mechanisms of projection, denial and regression. Four factors are identified as significant for containing destructive forces in a corporate merger: a) the role of emotional links to understanding the internal reality of a newly merged organisation; b) the containment of experiences of catastrophic change and projective processes; c) managing the realistic and neurotic anxieties of organisational members; and, d) identifying and managing the primary risk in a merger. A model is presented on the systems psychodynamics of a corporate merger. It identifies the change process that a merger entails, and the psychodynamics of this process using Bion's concept of container'contained. The thesis contributes to understanding the psychic reality of organisational mergers and offers a perspective that being alert to staff members' felt experiences and their emotional connectedness, as a normal part of business, provides 'leading data' on the health of the enterprise. Managers who are more 'wholly' informed about organisational realities, both external and psychic realities, can work more realistically on resolving problems, assessing risks, or making strategic business decisions.