Pharmaceutical giant AstraZeneca on Monday recommended shareholders of its American depositary shares reject a $115m ‘mini-tender’ offer from TRC Capital Investment, due to a low bid price.
It said the TRC offer of $57.88 per ADS in cash was 4.5% less than the closing price on the Nasdaq exchange on October 8, 2021, the last trading day before the mini-tender offer started.
“AstraZeneca does not in any way recommend or endorse the TRC Capital offer and recommends that shareholders reject the offer because the offer price is below the market price for ADSs immediately prior to this announcement,’ the company said.
It added that TRC had made “numerous unsolicited” mini-tender offers for other companies’ shares.
“Mini-tender offers are offers to purchase less than 5% of a company’s outstanding shares, thereby avoiding many of the filing, disclosure and procedural requirements of the United States Securities and Exchange Commission (SEC),” AstraZeneca said in a statement.
“Mini-tender offers do not therefore provide investors with the same level of protection as provided by larger tender offers under United States securities laws.”
AstraZeneca said the SEC has cautioned investors about such offers and citing the regulator as saying that “some bidders make mini-tender offers at below-market prices, hoping that they will catch investors off guard if the investors do not compare the offer price to the current market price”.
