tender offer

tender offer
General offer made publicly and directly to a firm's shareholders to buy their stock at a price well above the current value market price. Bloomberg Financial Dictionary
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A means of implementing an offer for subscription or offer for sale. The issuing house invites applications for shares, where the applicant specifies both the number of shares which they wish to buy and the price which they are prepared to pay. After the applications have been made, the issuing house will identify the best price at which the shares can be sold. All applicants will pay the same strike price, regardless of what price they bid. However, applicants who bid the highest prices will be awarded the shares in preference to those who bid lower prices. Dresdner Kleinwort Wasserstein financial glossary
For example, assume a company wished to issue 1,000 new shares and received three bids in a tender, one for 600 shares at a price of 200p, one for 800 shares at 150p and one for 400 shares at 100p. The investor who bid 200p would be issued with 600 shares and the investor who bid at 150p would receive 400 shares. The strike price could be set at 150p and both investors would pay this price.
Note that the strike price could not exceed 150p, otherwise the investor who bid 150p would not be prepared to buy the shares. In addition to being used in share markets, tenders have also been used in the past for new issues of gilts. Gilts are now normally issued by auction method, however. Dresdner Kleinwort Wasserstein financial glossary
See also fixed price offers and bookbuilding. Dresdner Kleinwort Wasserstein financial glossary
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acquisition offer / take over offer / purchase offer / buyback offer Euroclear Clearing and Settlement glossary
An offer made to shareholders, normally by a third party, requesting them to sell ( tender) or exchange their equities. Euroclear Clearing and Settlement glossary
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In an offer by tender, buyers of shares specify the price at which they are willing to purchase. Exchange Handbook Glossary
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Method of raising capital by inviting investors to make bids for the price they are willing to pay for the shares. Financial Services Glossary

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tender offer tender offer ➔ offer2

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   A company making a tender offer requires applicants to state the number of securities they require plus the price they are prepared to pay for them. Once all applications have been received, the company fixes a single 'striking price' at which the securities will be allotted to applicants at that price or higher. Also known as an offer for subscription.

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tender offer UK US noun [C] FINANCE, STOCK MARKET
► an occasion when a company offers to buy its own or another company's shares from existing shareholders at a particular price: »

The company's tender offer to purchase all outstanding shares of stock expires Monday.

 make a tender offer »

They made a tender offer to shareholders yesterday for 4.78m shares at 165p.

 »

The company launched a hostile 500p a share tender offer.

► an occasion when a company sells new shares to those who make offers for them above a particular lowest price. The company calculates the strike price (= final price to be paid) in relation to the total demand and the prices offered.

Financial and business terms. 2012.

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Look at other dictionaries:

  • tender offer — n: a public offer to purchase a specified number or range of shares from shareholders usu. at a premium and in an attempt to gain control of the issuing company Merriam Webster’s Dictionary of Law. Merriam Webster. 1996. tender offer …   Law dictionary

  • Tender offer — is a corporate finance term denoting a type of takeover bid. The tender offer is a public, open offer (usually announced in a newspaper advertisement) by an acquirer to all stockholders of a publicly traded corporation to tender their stock for… …   Wikipedia

  • tender offer — n. a public offer to purchase a block of stock in a corporation, often the controlling interest, within a specified period and at a stipulated price, usually well above the existing market price …   English World dictionary

  • Tender offer — General offer made publicly and directly to a firm s shareholders to buy their stock at a price well above the current market price. The New York Times Financial Glossary * * * tender offer tender offer ➔ offer2 * * *    A company making a tender …   Financial and business terms

  • tender offer — noun an offer to buy shares in a corporation (usually above the market price) for cash or securities or both • Hypernyms: ↑offer, ↑offering • Hyponyms: ↑takeover bid * * * a public offer to purchase stock of a corporation from its shareholders at …   Useful english dictionary

  • tender offer — 1) An offer by one company to buy the shares of another from the shareholders at a stated price (usually at a premium above the market price). It is normally made as part of a takeover bid See also self tender; two tier tender offer 2) See issue… …   Big dictionary of business and management

  • Tender offer premium — The premium offered above the current market price in a tender offer. The New York Times Financial Glossary …   Financial and business terms

  • tender offer premium — The premium offered above the current market price in a tender offer. Bloomberg Financial Dictionary …   Financial and business terms

  • tender offer — acquisition offer / take over offer / purchase offer / buyback offer An offer made to shareholders, normally by a third party, requesting them to sell (tender) or exchange their equities …   Euroclear glossary

  • Tender Offer — An offer to purchase some or all of shareholders shares in a corporation. The price offered is usually at a premium to the market price. Tender offers may be friendly or unfriendly. Securities and Exchange Commission laws require any corporation… …   Investment dictionary

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