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Performance effects of sell-offs and the role of sell-off experience

Author

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  • Erl, Ludwig Sebastian
  • Kiesel, Florian
  • Schiereck, Dirk
  • Koenigsmarck, Markus

Abstract

Divestitures are complex events undertaken for various motives and structured in multiple ways. This paper analyzes the long-term effects of sell-offs and sell-off experience on firm performance considering divestiture programs (divestitures using multiple sell-offs, having strategic intent and divestitures explicitly linked to a strategic reorientation). Our analysis reveals a positive effect of sell-offs structured as a divestiture program. However, the results suggest that in the context of such programs, potential learning transfers are outweighed by a negative performance associated with years of restructuring or inherent to firms undergoing a program. This paper contributes to the knowledge on performance effects of divestiture experience and provides evidence of the importance of programs.

Suggested Citation

  • Erl, Ludwig Sebastian & Kiesel, Florian & Schiereck, Dirk & Koenigsmarck, Markus, 2023. "Performance effects of sell-offs and the role of sell-off experience," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 142305, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
    • Handle: RePEc:dar:wpaper:142305
    Note: for complete metadata visit http://tubiblio.ulb.tu-darmstadt.de/142305/
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