In an oversubscribed tender offer, how are shares accepted from shareholders?

In an oversubscribed tender offer, where the number of shares tendered by shareholders exceeds the number the offering party is willing to purchase, shares are accepted on a proportional basis from those who tendered their shares. This means that shareholders who participate in the tender offer will have their submission accepted in relation to the total number of shares they tendered compared to the total shares tendered by all participants.

This proportional acceptance helps to ensure fairness among shareholders, as those who offer to sell more shares will receive a larger proportion of their offer fulfilled, while those who tender fewer shares will receive a smaller proportion. This method prevents any single shareholder from disproportionately benefiting from the offer, and it avoids the potential for favoritism or bias in the selection process.