If you tender shares, and even though discount at the time may be 4-5%, payment date for tendered share is 2 weeks away. If shares appreciate in 2 weeks ~2%(based on recent trend), buyback price would be higher. This would almost wipe off any advantage from tender offer. Additionally, any profit from tendered shares could create a tax event.
Partially true. THE NAV on Sept 17th and not 10th will determine the price you get. Anytime you sell shares even in open market you get the price you sell at, however you get the money 3 days later.
Purpose of the Repurchase Offer – The repurchase offer is intended to provide Fund stockholders who wish to have their shares repurchased based on net asset value (“NAV”) with the opportunity to have at least a portion of such shares repurchased.
What to Expect – The repurchase offer will begin on August 20, 2010 and end on September 10, 2010. Materials will be sent to stockholders of record as of August 13, 2010 in conjunction with the start of the offer on August 20, 2010.
Price – The repurchase price of the shares will be their NAV per share at the close of regular trading on the New York Stock Exchange (“NYSE”) on September 17, 2010. The shares tendered in the repurchase offer will be subject to a repurchase fee of 2% of NAV for expenses directly related to the repurchase offer.
Number of Shares – If more than 5% of the Fund’s outstanding common stock is tendered, the Fund will either (1) repurchase all of the additional shares tendered, if the additional shares do not exceed 2% of the Fund’s outstanding common stock, or (2) purchase 5% of the Fund’s outstanding common stock on a pro rata basis.
Deadline – The deadline for participating in the repurchase offer is 5:00 p.m. New York City time on September 10, 2010. The NAV of the shares may fluctuate between the deadline and September 17, 2010, the pricing date of the repurchase offer. The payment date for the repurchase offer is on or before September 24, 2010.
No tax event if in IRA or ROTH. You could buy back the next day (with different money)negating any market move. Could also go down adding to the 2-3% gain you get. There is always market risk - but if someone wants to give me a 2-3% edge I'll take it. Wish I could get that in Vegas.