What is a Tender Offer?
A tender offer is a proposal by an investor to all current shareholders of a publicly traded corporation to tender their shares for sale at a certain price at a certain time.
How does a Tender Offer work?
The prospective acquirer typically offers a higher price per share than the corporation's stock price. This provides shareholders with a greater incentive to unload their shares. For example, if a stock's current price is $10/share, someone wishing to take over the company might issue a tender offer for $12/share on the condition that he can acquire at least 51% of the shares.
Why do Tender Offers matter?
Tender offers can be executed without the consent of the company's board of directors. The potential acquirer can work directly with shareholders to takeover the company. Sometimes this is referred to as a "hostile takeover."
Personalized Financial Plans for an Uncertain Market
In today’s uncertain market, investors are looking for answers to help them grow and protect their savings. So we partnered with Vanguard Advisers -- one of the most trusted names in finance -- to offer you a financial plan built to withstand a variety of market and economic conditions. A Vanguard advisor will craft your customized plan and then manage your savings, giving you more confidence to help you meet your goals. Click here to get started.
