Tender

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What does 'Tender' mean

To invite bids for a project, or to accept a formal offer such as a takeover bid. Tender usually refers to the process whereby governments and financial institutions invite bids for large projects that must be submitted within a finite deadline. The term also refers to the process whereby shareholders submit their shares or securities to a takeover offer.

BREAKING DOWN 'Tender'

For projects or procurement, most institutions have a well-defined tender process, as well as processes to govern the opening, evaluation and final selection of the vendors. This ensures that the selection process is fair and transparent.

In the case of a takeover, most offers stipulate that a certain percentage of shares must be tendered by the deadline in order for the deal to proceed. Disgruntled shareholders who believe the takeover offer is too low often refuse to tender their shares; they may also try to marshal support from other shareholders against the takeover in a bid, to block the deal.

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RELATED FAQS
  1. 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 >>
  2. 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 >>
  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 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 >>
  5. If a company offers a buyback of its shares, how do I decide whether to accept the ...

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