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Hedged Tender

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Financial Dictionary

Hedged Tender

A strategy in a tender offer where an investor short sells a portion of the shares they own. This is to protect against the risk of loss in the event that the tender offer does not go through.

Investopedia Commentary

For example, imagine a stock was trading at $30, and there was a tender offer for $40 per share. A hedged tender would attempt to lock in the $40 per share even if the offer does not go through.

See also: Hedge, Short Sale, Tender, Tender Offer

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Financial Dictionary

hedged tender

An investor's tender of securities accompanied by the short sale of a portion of the securities tendered. The short sale hedges the possibility that not all the tendered securities will be accepted by the buyer and that the value of those securities not accepted will be less than the tender price.

Wall Street Words: An A to Z Guide to Investment Terms by David L. Scott.
Copyright © 2003. Published by Houghton Mifflin.
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