A tender offer is a kind of takeover bid for a public company.
In a tender offer, a bidder attempts to take over a public company by offering to purchase outstanding shares directly from the current shareholders at a stated price. The goal is to accumulate enough shares to gain a controlling stake in the business.
In order to convince shareholders to part with their shares, they are usually offered a premium over the current market price of those shares. However, the offer is usually conditional on enough shareholders agreeing to sell to provide the controlling stake in the business.
Recent Mentions on Fool.com
- Here's Why Ariad Pharmaceuticals' Stock Fell 10% Today
- 5 Signs That Transocean Is Becoming a Better Company
- Why Siliconware Precision Industries Jumped 25% On Friday
- Here's Why Shares of Cliffs Natural Resources Climbed 11% Today
- Why IPC Healthcare's Stock Soared Today
- Starbucks' CEO Believes Its Future Is Digital