Foreign Stock Exchange Listings: A Case Study of Daimler-Benz

In 1993, Daimler-Benz Corp. considered listing existing shares of stock as American Depositary Receipts (ADR) on the NYSE following several years of negotiations with the SEC on the nature of those disclosures. Daimler-Benz, the first German company to seriously consider listing on the NYSE, would have to provide financial information according to US GAAP in order to list. The following issues are discussed: 1. the costs and benefits of listing on foreign stock exchanges, 2. the process of listing on the NYSE, with special emphasis on listing requirements, 3. the major factors influencing Daimler-Benz's decision to list on the NYSE, 4. key differences between German and US GAAP, and 5. the impact of US GAAP on Daimler-Benz's reported earnings and shareholders' equity.