DEFINITION of 'Hedged Tender'

A strategy in a tender offer where an investor short sells a portion of the shares he or she owns. This strategy is used to protect against the risk of loss in the event that the tender offer does not go through.

BREAKING DOWN 'Hedged Tender'

For example, imagine a stock was trading at $30, and there was a tender offer for $40 per share. A hedged tender would attempt to lock in the $40 per share even if the offer does not go through.

RELATED TERMS
  1. Tender Offer

    An offer to purchase some or all of shareholders' shares in a ...
  2. Proration

    A situation during a corporate action in which the available ...
  3. Legal Tender

    Any official medium of payment recognized by law that can be ...
  4. Creeping Tender Offer

    A takeover strategy involving the gradual acquisition of the ...
  5. Schedule TO-C

    This schedule, filed with the SEC, is simply any written communication ...
  6. Tender

    To invite bids for a project, or to accept a formal offer such ...
Related Articles
  1. Small Business

    Explaining Tender Offers

    A tender offer is a broad public offer made by a person or company to purchase all or a portion of the shares of a publicly traded company.
  2. Managing Wealth

    3 Benefits of a Successful Tender Offer: Cliffs Natural (CLF)

    Learn about the potential benefits that the debt tender offer by Cliffs Natural Resources had for the company's balance sheet and income statement.
  3. Investing

    Is the NXP Semi/Qualcomm Tender Offer in Trouble?

    The options market suggests investors are cagey about Qualcomm's acquisition of NXP Semiconductor. We investigate.
  4. Investing

    NXP/Qualcomm: Is a New Deal Price Coming?

    Investors are reportedly pressuring NXP to get Qualcomm to raise its bid for their proposed merger.
  5. Financial Advisor

    The Basics of The Series 79 Exam

    Passing the Series 79 exam is usually necessary for anyone who wants to work in investment banking.
  6. Investing

    Why Qualcomm May Have to Pay $45 Billion for NXP

    Qualcomm is likely going to have to up its offer to nearly $45B to complete the NXPI deal.
  7. Investing

    Stock Buyback/Repurchase

    A stock buyback, or repurchase, occurs when a company buys its own shares off the market and therefore reduces the amount of stock outstanding.
  8. Investing

    A Breakdown Of Stock Buybacks

    Find out what these company programs achieve and what it means for stockholders.
  9. Investing

    Apple Twists Qualcomm's Arm

    Qualcomm cut its guidance on Friday after Apple changed up its royalty payment schedule.
RELATED FAQS
  1. What happens to the shares of stock purchased in a tender offer?

    Learn what a tender offer is, whether it is a good idea to accept a tender offer and what happens to the shares of stock ... Read Answer >>
  2. How is a tender offer used by an individual, group or company seeking to purchase ...

    Learn how tender offers are used in takeover attempts, and understand the difference between a hostile takeover and a friendly ... Read Answer >>
  3. Why would it be in the interest of shareholders to accept a tender offer?

    Learn when it is in the best interests of shareholders to accept a tender offer. A tender offer is a bid to buy a large portion ... Read Answer >>
  4. What usually happens to the price of a stock when a tender offer for shares of the ...

    Learn what happens to the price of a stock when a tender offer is made public. Some of the most contentious takeovers have ... Read Answer >>
  5. If a company offers a buyback of its shares, how do I decide whether to accept the ...

    Learn why it may often be in the best interest of a shareholder to accept a tender offer made at a premium to the market ... Read Answer >>
Hot Definitions
  1. Free Cash Flow - FCF

    A measure of financial performance calculated as operating cash flow minus capital expenditures. Free cash flow (FCF) represents ...
  2. Leverage Ratio

    Any ratio used to calculate the financial leverage of a company to get an idea of the company's methods of financing or to ...
  3. Two And Twenty

    A type of compensation structure that hedge fund managers typically employ in which part of compensation is performance based. ...
  4. Market Capitalization

    The total dollar market value of all of a company's outstanding shares. Market capitalization is calculated by multiplying ...
  5. Expense Ratio

    A measure of what it costs an investment company to operate a mutual fund. An expense ratio is determined through an annual ...
  6. Mezzanine Financing

    A hybrid of debt and equity financing that is typically used to finance the expansion of existing companies. Mezzanine financing ...
Trading Center