Tender Offer Defense Expense Insurance
Definition - What does Tender Offer Defense Expense Insurance mean?
Tender offer defense expense insurance is a policy that covers a company which has resorted to legal means to prevent its shares from being bought and acquired by a person or another company. This insurance pays for the expenses spent for those legal means, including the cost of litigation.
Insuranceopedia explains Tender Offer Defense Expense Insurance
A company can be a target of a hostile takeover. A person or another company might want to buy the majority of its shares by offering a high price (higher than its market price) to the stockholders. To stop the possible acquisition, the company will do something about it.
It might make a counter-offer to the stockholders. Or it can go to court. Civil proceeding entails expenses that are costly and might challenge the financial resources of the company. This policy saves the company from those costs.