Comparison
Tender offer vs buyback
Side-by-side: third-party-funded tender offer vs company-funded self-tender.
| Attribute | Buyback / self-tender | Third-party tender offer |
|---|---|---|
| Buyer | Company itself | Outside investor(s) |
| Source of capital | Company cash | Investor capital |
| Outstanding share count | Decreases | Unchanged |
| Company cash | Decreases | Unchanged |
| Other shareholders' ownership | Increases proportionally | Unchanged |
| Common regulatory frame (U.S.) | Rule 13e-4 (issuer tender) | Rule 14E general |
| Tax treatment for sellers | §302 framework — risk of dividend treatment | Generally a sale |