Tender

A tender is a formal offer to buy or sell something. In the context of finance, a tender is typically used to refer to an offer to buy a security, such as a bond or stock. The tender offer is made by a company or individual who is interested in purchasing a large number of securities from another company or individual. The offer is typically made at a price that is higher than the current market price of the security.

The tender offer is typically made in writing and is accompanied by a copy of the security that is being offered for purchase. The offer is also typically accompanied by a statement of the reasons why the offer is being made. The offeror may also provide information about how the securities will be used after they are purchased.

The tender offer is open for a specified period of time, typically 20 business days. During this time, the offeree (the person or company who owns the securities that are being offered for purchase) can decide whether or not to accept the offer. If the offeree accepts the offer, they must deliver the securities to the offeror within the specified time period.

If the offeree does not accept the offer, the offeror may withdraw the offer or may make a new offer at a higher price. If the offeror withdraws the offer, the offeree is free to sell the securities to anyone else. If the offeror makes a new offer at a higher price, the offeree may accept the new offer or may continue to hold the securities.

Tender offers are an important tool for companies and individuals to acquire securities. They can be used to acquire a large number of securities quickly and at a price that is favorable to the offeror. However, tender offers can also be used to take control of a company against the wishes of its shareholders.