Tender Offers Research Articles

The Requests for the Legal Certainty of Financial Supervisory Regulations—Focusing on the Study of the Tender Offer System

The Requests for the Legal Certainty of Financial Supervisory Regulations—Focusing on the Study of the Tender Offer System

Major Issues and Desirable Directions for Revision of the Korean Commercial Code and the Financial Investment Services and Capital Markets Act - Mainly Focusing on Electronic Shareholders’ Meeting, Mandatory Tender Offer and Investor Protection of Corporate Division -

Major Issues and Desirable Directions for Revision of the Korean Commercial Code and the Financial Investment Services and Capital Markets Act - Mainly Focusing on Electronic Shareholders’ Meeting, Mandatory Tender Offer and Investor Protection of Corporate Division -

The Requirement and Responsibility of Mandatory Tender Offer

The Requirement and Responsibility of Mandatory Tender Offer

A Momentum to the Tender Offer Method of Buyback in India – An Analytical Study

There are a number of methods of stock buyback by a limited company. However, tender offer and open market repurchases are widely adopted and known methods in India. The present paper concentrates on tender offer. Purpose of the paper is to outline the existing literature exclusively on tender offer and to examine effect of revised guidelines in choosing the method for buyback. The data on number of tender offer repurchases made by the companies in India from 1998 to 2022 have been gathered to analyze and to interpret the effect of the revised guidelines to achieve the objective of the paper. The paper finds that there is a positive effect of the revised guidelines on the choice of the method. The paper concludes that the use of the tender offer method of buyback is increased over a period of time due to the guidelines revised from time to time by the regulatory body to curb the loopholes in the methods.

The Chaos of Fighting for Corporate Control–Using General Meetings called by Indepen-dent Directors and Director Replacement through Tender Offers as Example

The Chaos of Fighting for Corporate Control–Using General Meetings called by Indepen-dent Directors and Director Replacement through Tender Offers as Example

Stock Tender Offer and Stock Prices: Evidence from the Indonesian Stock Exchanges

This study is to investigate the movement of stock price in a tender offer strategy by the firm. The ultimate of success and failure of tenders offers of a firm can be predicted by the stock prices movements. Twenty-three firms listed in Indonesian Stock Exchange are selected as a sample to be analyzed which carry out the tender offer during COVID-19 Pandemic period of year 2020 to 2022. The tender offer positively affects the stock price at the first day after tender offer period and the average stock price of one month period after the tender offer period. This study also shows that the difference between tender offer price and stock price of one day prior the tender offer period will negatively affect the stock price of one day after tender offer period and the average stock price of one month period after the tender offer period. The proportion of number of stocks to be offered in tender offer has no effect on stock price both in one day after stock tender offer period and the average stock price of one month period after the tender offer period. The result of the study is important for the stock market investors to get abnormal returns by buying stocks which will carry out a tender offer strategy and consider the motivation of firm to enhance the firm performance and good reputation of the prospective buyer.

Toward a "Tender Offer" Market for Labor Representation

Toward a "Tender Offer" Market for Labor Representation

Analysis of Listed Companies' Share Ownership Structures and Patterns of Tender Offers

Understanding of the entire picture of the share ownership structure of listed companies in each country in general will provide an important perspective for analyzing the present takeover rules in that country, and also for considering appropriate regimes for takeover rules for the future. This perspective is absolutely necessary from the standpoint of policymaking. Based on the awareness of the issue as mentioned above, I made an analysis of (i) the distribution of the shareholding ratios of the largest shareholders (Table 1), and (ii) the average shareholding ratios of the largest shareholders/second to tenth-ranked shareholders (Table 2) based on the latest data available as of April 30, 2013, so as to study the share ownership structure of listed companies in five countries, i.e. Japan, the U.S., the U.K., Germany and France. I also made an analysis of selected cases of tender offers of each country. The divergence between the mandatory offer rules and the patterns of tender offer models in the U.K., Germany and France, provides an important insight for legislative policies, as it suggests the following facts, in addition to the basic patterns of different share ownership structure models and tender offers: (i) even the same rules function differently depending on differences in the share ownership structure; and (ii) even a slight difference in the related regulations makes the rules function differently, if the share ownership structure is different.

Non-Price Criteria for the Evaluation of the Tender Offers in Public Procurement of Ukraine

Traditionally, public procurement has been associated with the measurement of achieving savings. However, recent research shows that the economic impact of public procurement is not limited only to savings, but by measuring the impact of four capitals—natural, human, social, and economic—on sustainable well-being over time. Ukraine is a country with a very low gross domestic product (GDP) per capita, which exacerbates the problem of the impact of public procurement results on the population’s welfare. Ukrainian public procurement legislation allows customers to apply non-price criteria (the share of non-price criteria cannot be more than 70%), which, together, are taken into account in the formula of the quoted price. The studies show that the effect of the use of non-price criteria depends on the relevance of the method of the evaluation of non-price criteria. The most important non-price criteria for Ukrainian customers by product categories and the methods of their evaluation are analyzed according to the Bi.prozorro.org analytics module. Therefore, it is concluded that the quoted price method, which is used in Ukrainian practice, is not relevant in comparison with the method used in the EU. A survey of the government buyers on the practice of applying non-price criteria was conducted, and the areas of their use were identified.

PELAKSANAAN PENAWARAN TENDER DALAM PASAR MODAL DAN AKIBAT HUKUMNYA DI INDONESIA

The problem of Tender Offer is sticking to the surface, among others, because there have been several cases involving the Takeover of a Public Company by another Party, thus causing losses to other Shareholders, especially the Public Shareholders. This study aims to determine the arrangement of Tender Offers in Indonesia and the impact of the Takeover on a Public Company that was taken over. The form of research in the writing of this journal is normative legal research using the statutory approach. The legal materials used are of two types, namely primary legal materials and secondary legal materials. The results of this research are: First, Mandatory Tender Offer is regulated in POJK No. 9/POJK.04/2018. There is a provision that the Controllers must refloate within two years if the share ownership exceeds 80% as a result of the Mandatory Tender Offer. Then, the Voluntary Tender Offer is regulated in POJK No. 54/POJK.04/2015 concerning Voluntary Tender Offer. In general, the background to the Voluntary Tender Offer is that the Target Company plans to be delisted, as well as changing its status to a Private Company (Go Private). Also, the Voluntary Tender Offer can be made if the Bidder wishes to increase its investment portfolio and assesses that the Target Company has the potential to continue to develop in the future. Second, Takeovers can have legal consequences on the status of the company, company controllers, and employment.

The Delisting of a Company from the Warsaw Stock Exchange as a Result of the Cancellation of the Dematerialisation of Shares – Tender Offer Price vs. IPO Price

<p>Theoretical background: The growth in the number of companies delisted from the Warsaw Stock Exchange (WSE), as a result of the cancellation of the dematerialisation of shares, has become a reason for considerations regarding the share price in tender offers addressed to shareholders who have held company securities since the Initial Public Offering (IPO).</p><p>Purpose of the article: The goal of this study was to evaluate whether the price in tender offers of the shares of companies which had finally been excluded from trading on the WSE as a result of the cancellation of the dematerialisation of shares would ensure a positive rate of return for shareholders who have held the shares since this company’s debut on the regulated market of the WSE.</p><p>Research methods: Public tender offers, announced between 2012 and 2018 on the regulated market of the WSE have been analysed. The analysis covered prices of shares of new listings on the WSE and share prices in the tender offers of 213 companies, out of which 55 companies have been excluded from trading on the regulated market of the WSE as a result of the cancellation of the dematerialisation of shares.</p><p>Main findings: The results of the research indicate that more than a half of the shareholders who have held the securities of companies in their portfolio since their debut, have suffered losses after companies have been excluded from trading on the WSE as a result of the cancellation of the dematerialisation of shares. Only 11% of the examined companies have generated more than double profit for investors compared with the issue price during their IPO. This research is one of the few studies on the Polish stock market to the best of the author’s knowledge.</p>

The Effect of Institutional Investors’ Voice on the Terms and Outcome of Freeze-out Tender Offers

We study the impact of institutional investors’ “voice” on 201 going private tender offers by controlling shareholders (“freeze-out” offers) in Israel. Israeli regulatory intervention in freeze-out tender offers is relatively mild; thus, institutional investors’ activism becomes crucial. We find that institutional voice has dual effects. On one hand, when there are pre-negotiations with institutional investors’ (their voice is heard), accepted offers’ premiums increase. On the other hand, when institutional investors express their voice, yet reject the offer, these rejections appear to hurt shareholders’ value. We also document significant institutional investor exit after rejected offers, especially after offers preceded by voice (pre-negotiations with institutional investors).

Reservation Prices in Shareholders’ Response to Freeze-Out Tender Offers

We employ a sample of 201 freeze-out tender offers (offers of controlling shareholders to buy all public shares) in Israel to examine how investors’ decision (to accept or reject the offer) is influenced by alternative reference prices, some of which are commonly specified in freeze-out offers. Our findings reveal that average purchase price is the key reservation price - when freeze-out offer price exceeds our novel estimate of the minority shareholders’ average purchase price of the shares, offer acceptance probability increases significantly. Thus, purchase price appears as a more fundamental behavioral anchor than its main competitor - the past 52-weeks high.

Irrevocable Commitments and Tender Offer Outcomes

Irrevocable commitments (ICs) are undertakings by target-firm blockholders to accept an upcoming takeover bid before its announcement. Using a novel manually-collected dataset, we develop three new hypotheses and explore one existing hypothesis to explain the use of ICs: (1) trade-off between speed and price; (2) trade-off between completion probability and price; (3) differences in bargaining power, and (4) blockholder certification. Transactions with more than 20% of shares irrevocably committed have a 7–16% higher probability of tender offer completion and 8–10 days shorter bid duration. A transaction with an average-sized irrevocable commitment is associated with a 2.9 percentage points lower four-week bid premium than a transaction with no irrevocable commitment. Overall, the results appear most consistent with the hypothesis on completion probability versus price. The results also offer partial evidence in favor of the certification hypothesis.

Institutional Investors' Impact on the Terms and Outcome of Freeze-Out Tender Offers

We study the impact of institutional investors' “voice” on 201 going private tender offers by controlling shareholders (freeze-out offers) in Israel. Israeli regulatory intervention in freeze-out tender offers is relatively mild, thus institutional investors’ activism becomes crucial. We find that institutional voice has dual effects. On one hand, when there are pre-negotiations with institutional investors’ (their voice is heard), accepted offers’ premiums increase. On the other hand, when institutional investors express their voice, yet reject the offer, these rejections appear to hurt shareholders’ value. We also document significant institutional investor exit after rejected offers, especially after offers preceded by voice (pre-negotiations with institutional investors).

The Relation between the Readability of Accounting Footnotes Information and the Company Value of the Appraisal Reports of Public Tender Offer in Brazil

We studied the relation between the Accounting footnotes readability and company value, using five metrics to measure readability: word, sentence, and paragraph lengths, numbers of graphic elements and pages. To obtain the company value, we used appraisal reports of public tender offer to acquire shares from the last nine years, which got to a 90 Brazilian company sample. The methods analyzed were: discounted cash flow, market price of shares after the public tender offer announcement, multiples, and equity book value. The results showed a high correlation between the sentence length and all four valuation methods, while the OLS multiple regression showed a relation between the footnote readability component that included word and sentence lengths and company valuation by DCF and equity methods. The other indexes showed no relation to the company value, except when we use the share price before the announcement as a control variable, then, it becomes significant for the equity method.

The Public Stock Buyback Tender Offer in France

This article focuses on the public stock buyback tender offers carried out in France between 1996 and 2005. First, we will study the impact of The Public Stock Buyback Tender Offers’ announcements on stock prices. The results of the event studies show that these announcements are welcomed by a very favorable price reaction. Secondly, we try to explain the premium in the repurchase mode. The results of the linear regressions show that a low level of liquidity and the securities’ performance, during the period preceding the public stock buyback tender offer, seems to push companies to pay large premiums. It also appears from these regressions that smaller companies, accepting the over demand and for a significant percentage from the capital; are also encouraged to offer high premiums.

Sanofi-Aventis's Tender Offer for Genzyme

In October 2010, Henri Termeer, the chairman and CEO of Genzyme, received a letter from the CEO of Sanofi-Aventis announcing its intention to commence a tender offer for Genzyme. Termeer thought the offer undervalued Genzyme, given the number of promising new drugs in the company's pipeline and the success of its current drug portfolio. The case focuses on the strategic and financial considerations of a large corporate acquisition. To estimate Genzyme's fundamental value, students must conduct a discounted cash flow and other valuation analyses. This case is designed to be part of a firm-valuation module within either a first-year MBA principles course or a second-year MBA elective; it can also be taught to executives who have M&A experience and can bring extra insights regarding the strategic fit and leadership issues. Excerpt UVA-F-1716 Rev. Jun. 21, 2018 Sanofi-Aventis's Tender Offer for Genzyme On the foggy morning of October 5, 2010, Henri Termeer, the chairman and CEO of Genzyme Corporation, drove to the firm's headquarters in Cambridge, Massachusetts. Termeer usually spent his early mornings working from the indoor garden on top of the building, but on that day he went straight to his office, grabbing a cup of coffee on his way. One thing was on his mind—the letter he had received from the CEO of Sanofi-Aventis (Sanofi) announcing the company's intention to commence a tender offer for Genzyme (Exhibit 1). Termeer had been Genzyme's CEO for more than 25 years, leading the company through its growth from an entrepreneurial venture to one of the country's top five biotechnology firms. Yet the past two years had presented a significant test. Genzyme was just recovering from an unexpected contamination in 2009 at its major production facility in Allston, Massachusetts, which had led to shutting down the plant and limiting the supply of life-sustaining drugs for Genzyme's patients. As a result of the economic and reputational damages, the company's stock had plummeted, before rebounding as a result of the news of the tender offer (Exhibit2). When compared to the industry and the overall stock market during the previous decade, however, the stock had performed very well (Exhibit 3). The recent downturn in the stock price had attracted activist investors, which resulted in Genzyme entering into a cooperation agreement with Relational Investors and subsequently fending off a proxy battle with Carl Icahn. But Termeer fully understood that together the two activists controlled a substantive position of Genzyme shares and wanted to exit their positions at a gain (Exhibit 4). Sanofi, the leading French pharmaceutical company, had approached Genzyme as a potential acquisition at the start of the summer. After a few rounds of negotiating, Termeer and his board publicly rejected Sanofi's cash offer of $ 69 per share on August 29, 2010. The letter from Sanofi's CEO conveyed frustration with Termeer's unwillingness “to engage in constructive discussions” (Exhibit 1) and announced that Sanofi would be circumventing Termeer by taking the $ 69 tender offer directly to Genzyme's shareholders. . . .

The Investment Strategy When Having a Breach of Tender Offer: A Case Study of Taiwan's Online Game Companies

Having robust investment in the financial market has been the objective of many investors. However, as the financialmarkets in developing countries are not well established, the first-ever settlement default in tender offer happened inTaiwan securities market in August 2016. The Japanese company, Bai Chi Gan Tou, failed to pay for the acquisition.This study uses the contrary investment strategy suggested by Kestner (2003) to analyze 1150 daily trading data ofXPEC Entertainment, a major online game company in Taiwan, during the period 1 January 2012 to 1 September2016. Based on the program trading simulation of 100-day mean reversion trading performance after price diversionand fourteen online game companies as the investment portfolio, the trading profit is $86, showing an increase of10.92%, and exceeds the stock market index by 4.85%.This study further tests the Granger causality, chooses the bellwether stock, X-Legend Entertainment, and uses thetechnical analysis to examine the mean reversion after price diversion based on program trading. The optimalcoefficient from the first stage is extended and used in the second stage to obtain trading profits of $905.59, anincrease of 115.03%. The resulting performance is better than that based on Kestner’s (2003) trading strategy.Therefore, the empirical evidence suggests that latter approach can help make stable profits in the versatile onlinegame stock markets and that the Taiwan online game stock market does not fulfill an efficient market condition. Inconclusion, this study finds evidence supporting our hypothesis that the information of bellwether stock and pricemean reversion characteristic can be used to enhance trading performance in the stock market.

A Study of Motivators of Tender Offer Repurchases in the Indian Environment

<div><p><em>Share buybacks are a 15 year old process in India. In developed countries share buyback is a well-accepted practice but in India the concept has yet to gain popularity. The article tries to look at the tender offer repurchases in Indian between the periods 2004 to September 2013. There were 51 public announcements for share buyback through tender offer route. The other popular method is open market repurchase. The paper tries to identify the main drivers in the tender offer repurchase through regression analysis. The more significant drivers are reduction of earnings per share through buyback, correction in capital structure and improvement in return ratios like return on net worth . The paper also looks at identifying the impact on promoter’s holding through tender offer buyback and identify if it is one of the drivers of share buyback.</em></p></div>