Tender Period

The tender period is the specified window of time during which shareholders of a target company can submit (tender) their shares for purchase by an acquirer under an open offer made pursuant to the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 — the Indian Takeover Code. During the tender period — which must be a minimum of 10 working days as per SEBI regulations — shareholders must decide whether to accept the offer price and tender their shares to the acquirer through the designated clearing mechanism, or retain their shares and continue as shareholders of the target company post-acquisition. The tender period begins after SEBI grants its observations on the offer document and the acquirer makes the public announcement of the open offer. Shareholders who tender their shares receive the offer price (which must be the higher of various price benchmarks specified under the Takeover Code) regardless of whether the stock is trading above or below that price in the secondary market. For Indian equity investors, monitoring open offer tender periods is important — if the offer price is above the current market price, tendering is typically advantageous, but if the stock has risen above the offer price in anticipation of a competing bid or better terms, holding rather than tendering may be more profitable. SEBI allows partial acceptance in oversubscribed tender offers, with shares allocated proportionally among tendering shareholders.