In positive-negative selection, only cells with homologous recombination will:
Gene targeting vectors carry neo inside homology arms and HSV-tk outside. Any random integration retains both cassettes, making cells G418 resistant but ganciclovir sensitive because tk converts ganciclovir to a cytotoxic form. Homologous recombination replaces the genomic locus through double crossover, incorporating neo but losing tk sequences. Consequently only homologous recombinants acquire G418 resistance due to neo expression while avoiding tk-mediated toxicity. Growth in medium containing both G418 and ganciclovir therefore selectively enriches the rare correctly targeted embryonic stem cell clones.
Ref: NCERT Biology Class XII Principles on Klenow fill-in labeling, Lehninger Chapter 9 DNA cloning techniques, and Molecular Cloning by Sambrook Chapter 10 documenting end-labeling of cohesive termini.