Increasing Trends in United States Tenders in Acquisition and Merger Industry
Uncertainties in the market situation during the last few years have encouraged both buyers and sellers
in United States to conclude the transactions as quickly as possible. In result there has been an ever
increasing trend in the numerical strength of United States tenders.
With the introduction of the “all holders best price” rules by the SEC or Securities and Exchange
Commission in United States, tenders are taking a dominating role in the commercial transactions across
the country. United States tenders offer good opportunities now.
Negotiated Transactions in United States tenders
In negotiated transactions the buyers usually have the support from the targeted companies.
• Thus in the recent times buyers prefer to conclude all such negotiation through United States
tenders.
• In fact, offers have become the first step in wining over the target company.
• One out of every three transactions over hundred million dollars have been structured as United
States tenders.
Acquisition and Merger United States Tenders
After the issuance of the regulations by SEC, all acquisition and merger tenders are regulated according
to guidelines issued by them. Since it is important complying with the requirements prescribed by SEC in
case of United States Tenders, every bidder has to take care of the following factors that are common to
all such instruments.
Usually the transactions would be all cash.
Buyer would have operational control over the post-tender phase for United States tenders.
Condition that was prevalent before the offer of tender was floated should be taken into
consideration.
Such requirement becomes more pertinent in case of acquiring majority of the outstanding
shares of the target company through United States tenders.
Support agreements can be concluded with major stockholders so that larger blocks of the
outstanding shares of the target company can be effectively blocked.
Experiences of Transactions Concluded Using United States tenders
Experiences gained from the transactions concluded so far indicate that in some of the cases there were
absolutely no threshold in respect of the target shares that were to be made subject matter of United
States tenders. In other cases the situation is a bit different as anything in the range of 75%-85% of
the shares of the target company is acquired by the acquiring company. In over 50% of such cases the
transactions were made through tender offers in 2009 wherever the overall value of the assets in United
States tenders were more than $100 million.
Examples of United States Tenders Relating to Merger
Back in the month of January during the current year, agreement was concluded between the parent
company Trustmark Mutual Holding and Health Fitness Corporation as buyers and sellers respectively.
While the purchaser agreed for United States tenders in cash at $8.78 per share for each and every
outstanding share that the seller had in the market, most of these shares were made part of tender
offers. None of the shares were to be withdrawn from the market till the offer period was over.
It was an example of importance attached to tender processes by the buyer and seller in multi-million
commercial transactions through United States tenders that offer huge opportunities for entrepreneurs.
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