A tender offer is a type of public takeover bid constituting an offer to purchase some or all of shareholders' shares in a corporation. Tender offers are typically made publicly and invite shareholders to sell their shares for a specified price and within a particular window of time. The price offered is usually at a premium to the market price and is often contingent upon a minimum or a maximum number of shares sold. To tender is to invite bids for a project or accept a formal offer such as a takeover bid.
Most tender offers are made at a specified price that represents a significant premium over the current stock share price to induce a large number of shareholders to sell their shares. In the case of a takeover attempt, the tender may be conditional on the prospective buyer being able to obtain a certain number of shares.
Tender offers provide several advantages to investors as they are not obligated to buy shares until a set number are tendered, which eliminates large upfront cash outlays and prevents investors from liquidating stock positions if offers fail.
Any person submitting a tender offer should present the offer to Boursa Kuwait and announce it on Boursa Kuwait's website after providing the required information.
Participation periods for tender offers are ten working days. You can get more details regarding tender offers and their rules by visiting the Boursa Kuwait Rulebook.