Comparisons
Quick side-by-side answers to the most-asked tender-offer questions.
A break-up fee is paid by the target to the bidder if the target walks. A reverse break fee is paid by the bidder to the target if the bidder walks.
A cash tender pays cash for tendered shares. An exchange offer pays in bidder securities (typically stock) at a defined exchange ratio.
Drag-along lets a majority force minorities to sell on the same terms. Tag-along lets minorities join a majority sale on the same terms.
A fixed-price tender announces one price upfront. A Dutch auction discovers the clearing price within a stated range during the offer.
Friendly tenders are launched with target board support; hostile tenders go directly to shareholders against the board's wishes.
Issuer tenders are funded by the company itself (Rule 13e-4); third-party tenders are funded by an outside acquirer (Reg 14D).
A voluntary bid is launched at the bidder's election. A mandatory bid is required by law once the bidder crosses a control threshold (non-US regimes).
A no-shop prohibits the target from soliciting competing bids. A go-shop gives the target an active window to solicit competing bids after signing.
A poison pill triggers economic dilution against any acquirer crossing a threshold. A staggered board slows board control change to multiple election cycles.
Both report >5% beneficial ownership. 13D is the long-form for active holders; 13G is the short-form for passive institutions.
Side-by-side: third-party-funded tender offer vs company-funded self-tender.
Side-by-side: a private one-off liquidity event vs a public continuous market.
Tender offers run shareholder-by-shareholder; mergers are corporate-action transactions requiring board and shareholder approval.
Side-by-side: a structured, multi-seller program vs a one-off bilateral transfer.
A tender offer is a structured, defined-window buyback. An open-market repurchase is a continuous, opportunistic buyback under Rule 10b-18.
A white knight acquires the entire target. A white squire takes a friendly minority block large enough to deter a hostile bidder.