Is a tender offer considered an offer of securities?

A tender offer is characterized as an offer to purchase a substantial amount of shares from the shareholders of a company at a specific price, typically at a premium over the current market price. This type of offer is not classified as an offer of securities because it does not involve the issuer of the security directly offering new shares to investors. Instead, it is an approach made by an acquirer to the shareholders, indicating a desire to buy their existing shares.

In this context, understanding the nature of a tender offer clarifies why it is deemed an offer to buy rather than an offer of securities. It is based on negotiations and intentions to acquire ownership interests, rather than a formal public offering of new securities conducted by the issuing company that would require registration. Thus, while the transaction involves securities, the mechanics of what a tender offer entails categorize it as an offer to buy existing shares rather than an offering of new securities.