What is a tender offer?

A tender offer is a corporate law term used in Delaware and other states. It is a public offer made to shareholders of a corporation to buy their stock at a specified price. This offer is typically made by an outside company, often as part of a hostile takeover. The tender offer is made to the shareholders of a target company and must be disclosed to the SEC. Shareholders are allowed to accept the tender offer and sell their shares for the offered price. This price is usually higher than the market value of the stock and allows the shareholders to quickly profit from the sale. In addition, the company making the tender offer will often give shareholders additional incentives to accept the offer. Shareholders can also reject the tender offer, in which case they keep their stock and continue to benefit from any future changes in the market value. In Delaware, the tender offers must meet certain qualifications as prescribed by the Delaware General Corporation Law. These qualifications include that the offer must be open for at least 20 days and that all of the terms and conditions of the offer must be made available to shareholders before they can decide if they want to accept the offer.

Related FAQs

What are the requirements to maintain a corporation?
What is the role of corporate fraud investigators?
What is a proxy vote?
How do I form a corporation?
What is the purpose of corporate records retention?
What are the rules and regulations governing corporate filings?
What are the disadvantages of forming a LLC?
What is the process for declaring corporate dividends?
What are the legal rights and responsibilities of shareholders?
What are the corporate governance requirements?

What is a tender offer?

Related FAQs

Related Blog Posts