Novartis has asked investors to reject an unsolicited 'mini-tender' submitted by a private Canadian investment firm which has offered to purchase up to two million shares

The Switzerland-headquartered healthcare giant says it has been notified of the offer by TRC Capital Corp to purchase up to two million American Depositary Shares, or 0.08% of the group's outstanding share capital. Novartis is unimpressed and notes that the Canadian group's offer price of $51.50 represented a 4.4% discount to the closing price of its ADSs on June 2, the day before the offer commenced.

Novartis added that mini-tender offers such as this one "avoid most of the investor protections" afforded for larger deals, including the filing of disclosure documents with the US Securities and Exchange Commission . The firm, which stressed that it is "in no way associated with TRC Capital", urged investors to "consult with their financial advisors and to exercise caution with respect to this offer" and shareholders who have already tendered their ADSs may withdraw them prior to expiration of the offer, currently scheduled for July 2.

Novartis concluded by noting the SEC's "long-standing investor alert regarding mini-tender offers". The latter notes that in making these offers at below-market prices, bidders are "hoping that they will catch investors off guard".