self-tender

self-tender

An offer by a firm to repurchase some of its own securities from stockholders, generally on a pro rata basis from those shares offered for sale. A self-tender may be preferable to purchase of the securities in the open market because a self-tender is quicker and will not disrupt public trading in the securities. Firms frequently repurchase their own stock from investors holding fewer than a set number of shares in order to eliminate the high cost of servicing small stockholders. A self-tender is similar to a buyback except that buybacks often refer to repurchases from special groups or a few large holders. Also called stock repurchase plan.