Open Offer
A mandatory offer to buy shares from public shareholders, triggered when an acquirer crosses a control threshold.
How it is identified
Trigger: acquiring 25% or more of voting rights, or acquiring control; the offer must be for at least 26% of the expanded voting capital
Unit
qualitative
In depth
The open offer is the central protection in India's takeover regulations: it ensures that when control changes hands, public shareholders get the chance to exit at a price benchmarked to what the acquirer paid. The offer price is determined by a formula based on the negotiated price and recent market prices, so it cannot be set arbitrarily low. Shareholders may accept or decline, and if the offer is oversubscribed acceptance is proportional. An additional creeping acquisition allowance permits a further 5% a year without triggering a fresh offer, up to the maximum public shareholding limit.
Worked example
An acquirer buying 26% at ₹620 must offer public shareholders at least 26% of the expanded capital at a price set by the formula, generally no less than the ₹620 paid to the outgoing promoter.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Open Offer” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.