Definition
Consideration mix describes how the offer price is split between cash and other forms of consideration. Most modern public tender offers are 100% cash; mixed deals split between cash and bidder stock.
Why it matters
- All cash — clean, high certainty for the seller, taxable
- All stock — tax-deferred (if structured as a §368 reorganization), but introduces price risk on the bidder’s stock and ongoing equity exposure
- Mixed — combines both with their tradeoffs; election structures let holders pick within an overall cap
Practical impact
The mix shapes which holders find the deal attractive. Tax-sensitive long-term holders may prefer stock; arbs and short-term holders prefer cash certainty.