A tender offer is an offer to buy a portion or all of the shares of a company from its shareholders. Taking the tender offer is equivalent to SELLING your shares at the fixed price stated in the offer.
You have three (3) responding options to this offer:
- Take the tender offer (preferably if the market price is lower than the tender offer price)
- Sell your shares at the market (best if the market price is higher than the tender offer price)
- Decline the offer and keep your shares (if you feel strongly about holding the shares*)
*Note: Do understand that a company may be delisted from trading if majority of its listed shares are acquired through a tender offer. A delisted company may not trade its shares in the PSE anymore and could render valueless the shares one would hold given that it cannot be sold and re-converted back into its cash value.
The purpose of a company for issuing a tender offer varies and so it is always best to review the terms and conditions of the offer to determine your best course of action.