DowDuPont announced that it has been notified of a “mini-tender” offer by TRC Capital Corporation to purchase up to 2 million shares of DowDuPont Inc.’s common stock at $60.25 per share.
The offers, aimed at individual investors who may not be following the company’s stock price is about 5.4 percent below the closing share price of DowDuPont on March 29.
DowDuPont has a large number of retirees in the region who might be the targets of the mini-tender.
DowDuPont recommends that DowDuPont stockholders reject the offer and not tender their shares in response to TRC Capital’s unsolicited mini-tender offer. The offer is subject to conditions that include TRC’s ability to obtain financing.
TRC Capital has made similar, unsolicited mini-tender offers for shares of other publicly-traded companies.
Mini-tender offers are designed to seek to acquire less than 5 percent of a company’s outstanding shares, thereby avoiding disclosure and procedural requirements of the Securities and Exchange Commission that apply to tender offers for more than five percent of a company’s outstanding shares. As a result, mini-tender offers do not provide investors with the same level of protection as provided by larger tender offer.
The SEC’s guidance to investors on mini-tender offers is available at www.sec.gov/investor/pubs/minitend.htm.
Mini-tender offers may be tied to recent volatility in the stock market that can lead to some investors panicking and accepting the offer without investigating the details.
Many investors who hear about mini-tender offers surrender their securities without investigating the offer, assuming that the price offered includes the premium usually present in larger, traditional tender offers. But they later learn that they cannot withdraw from the offer and may end up selling their securities at below-market prices, the DowDuPont release noted.
DowDuPont stockholders who have already tendered are advised that they may withdraw their shares by providing the written notice described in the TRC Capital offering documents prior to the expiration of the offer, which is currently scheduled at 12:01 a.m. New York City time on Wednesday, April 25, 2018.
DowDuPont is a temporary entity that is slated to be spun off into three companies in agribusiness (Corteva); Specialty Products. (DuPont) and Materials Science (Dow). Corteva and DuPont will be based in Delaware.
