What You Need to Know
On April 16, 2026, the SEC’s Division of Corporation Finance issued an exemptive order permitting certain all-cash tender offers for equity securities to close in as few as 10 business days, rather than the standard minimum of 20 business days. The order applies to third-party tender offers for reporting company securities and issuer self-tenders, as well as certain offers for securities of non-reporting companies.
Key conditions include: the offer must consist solely of cash at a fixed price; a third-party offer must be made under a negotiated merger agreement for all outstanding securities of the class; and the offer must be announced by 10:00 a.m. Eastern time on the commencement date via a widely disseminated press release with a hyperlink to the tender offer materials. Issuer self-tenders must be for less than all outstanding securities of the class.
The relief is unavailable for going-private transactions under Rule 13e-3, offers relying on cross-border exemptions, and situations involving competing tender offers. Material changes to the offer terms must be announced within specified timeframes before expiration.
Why It’s Important
One of the most significant implications of the new order is that parties may increasingly structure negotiated deals as tender offers as a way of closing more expeditiously. A tender offer can commence as soon as the offer materials are filed and disseminated, and, under the new order, can expire in as few as 10 business days. In a “traditional” cash merger transaction (one in which stockholders are given the opportunity to vote on a merger agreement), the acquiror must prepare and file a proxy statement with the SEC, wait for the SEC to review the proxy statement, respond to (potentially multiple rounds of) comments from the SEC, observe a notice period before holding a shareholder meeting, and then hold the vote - a process that typically takes several months. It is important to note, though, that many transactions will still require more than 10 business days to close for regulatory or other reasons.
What You Need to Do
- Evaluate Structuring - Assess whether pending or planned acquisitions could benefit from structuring as all-cash tender offers to take advantage of the shortened offering period.
- Confirm Eligibility - Verify that the offer satisfies all conditions of the exemptive order and that no exclusions apply (e.g., going-private transactions, cross-border exemptions, or pending competing offers).
- Plan for Regulatory Timing - Coordinate with antitrust counsel on Hart-Scott-Rodino Act timing and plan for the possibility of extending the offer beyond 10 business days. (The initial antitrust review period for all-cash tender offers is 15 calendar days, and a second request could require extending the offer further.)
- Update Offer Documentation and Processes - Ensure press releases and offer documents are prepared to meet the order’s commencement announcement requirements, and build processes for timely disclosure of any material changes to offer terms.
- Monitor Developments - Track SEC guidance and market developments, as the Division has reserved the right to modify or withdraw the relief.
Contact Christopher Seifter or Bob Lamm of Gunster's Securities Law & Corporate Governance practice to discuss how this exemptive order may affect your pending or planned transactions.
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