Peach Corp. operates a chain of supermarkets. The managers and employees of the company have been on strike for months due to their differences with its owners. As a result, the share price of the company has fallen to historic low. Globe Investments decides to purchase a majority of the shares of Peach Corp., confident that it can manage the company better. Globe Investments makes a public offer to purchase the shares of the investors who are dissatisfied with the performance of Peach Corp. The offer made by Globe Investments can be termed as a(n)________.

Question

Quizplus · Accepted Answer

Globe Investments' offer to purchase shares from dissatisfied investors is a tender offer. A tender offer is a public offer to buy shares from a large number of shareholders, typically at a premium to the current market price, with the intention of gaining majority control of a company. This would allow Globe Investments to take over the management of Peach Corp. and improve its performance. A proxy offer involves acquiring the right to vote the shares of another investor, a discount offer involves offering shares at a lower price than the current market price, and a private offer is made to a specific individual or group of individuals.