UnitedHealth Group is advising its shareholders to reject a “mini-tender” offer.
In a June 23 news release, the company said shareholders who sell their shares in the offer will receive a below-market price.
Here are three things to know:
- Tutanota, a financial services company, offered to purchase less than 1% of UnitedHealth Group’s stock at below-market price. The offer was unsolicited by UnitedHealth Group, according to the news release.
- In mini-tender offers, companies seek to purchase less than 5% of a company’s shares. The 5% threshold triggers additional regulatory requirements with the Securities and Exchange Commission. The SEC warns these offers are sometimes used to catch investors off-guard — with investors assuming they are receiving a premium for their stock.
- Tutanota has made similar offers for several companies in the past, including Eli Lilly, Bank of America and Starbucks.
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