Foreign and Domestic Takeovers in Germany: Cherry-picking and Lemon-grabbing
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Lüneburg: Institut für Volkswirtschaftslehre der Universität Lüneburg, 2012. (Working Paper Series in Economics; No. 240).
Research output: Working paper › Working papers
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TY - UNPB
T1 - Foreign and Domestic Takeovers in Germany: Cherry-picking and Lemon-grabbing
AU - Weche Gelübcke, John Philipp
PY - 2012
Y1 - 2012
N2 - This study focuses on ex ante performance of domestic and foreign takeover targets in Germany, one of the most important FDI infl ow destinations worldwide. Using a new database from German offcial statistics, unconditional comparisons as well as binary response model estimations of takeover probabilities were performed for the manufacturing and service sector separately. The results showed a diametrically opposing impact of productivity and profitability on the takeover likelihood. This offers a conciliation of two supposedly opponent hypotheses, known as 'cherry-picking' and 'lemon-grabbing'. The results advocate assumptions of asset-exploiting and information asymmetries in favor of domestic investors but differ only marginally between foreign and domestic targets.
AB - This study focuses on ex ante performance of domestic and foreign takeover targets in Germany, one of the most important FDI infl ow destinations worldwide. Using a new database from German offcial statistics, unconditional comparisons as well as binary response model estimations of takeover probabilities were performed for the manufacturing and service sector separately. The results showed a diametrically opposing impact of productivity and profitability on the takeover likelihood. This offers a conciliation of two supposedly opponent hypotheses, known as 'cherry-picking' and 'lemon-grabbing'. The results advocate assumptions of asset-exploiting and information asymmetries in favor of domestic investors but differ only marginally between foreign and domestic targets.
KW - Economics
KW - foreign ownership
KW - Germany
KW - acquisition
KW - firm performance
KW - services
KW - inward FDI
KW - multinational firms
KW - productivity
M3 - Working papers
T3 - Working Paper Series in Economics
BT - Foreign and Domestic Takeovers in Germany: Cherry-picking and Lemon-grabbing
PB - Institut für Volkswirtschaftslehre der Universität Lüneburg
CY - Lüneburg
ER -