This study investigates the determinants of tender premiums and the impact of bond tender offers on stockholder returns within the European corporate bond market from 2010 to 2019. Building on prior research by De Jong, Roosenboom, and Schramade (2009), this work examines a new dataset of 439 tender offers involving euro-denominated bonds. The research aims to capture key factors influencing tender premiums, such as consent solicitation, takeover activity, remaining bond maturity, return on assets, and debt levels. To evaluate abnormal stockholder returns surrounding the tender offer announcements, this study uses a market model based on the Capital Asset Pricing Model (CAPM).
Contrary to prior findings, no positive relationship was found between the tender premiums and consent solicitation or bond maturity, or a negative relationship with takeover activity. The average tender premium is significantly smaller, 0,58% than in previous research, likely reflecting a less liquid bond market. This study contributes to a deeper understanding of the evolvement of the bond tender offer market in Europe.
