What is the primary reason for a company to conduct a tender offer?

A tender offer is a strategy used by a company to purchase its own shares from existing shareholders, typically at a premium over the market price. The primary reason for conducting a tender offer is to facilitate taking the company private. This occurs when a company's management or a group of investors seeks to buy back enough shares to gain control of the company, often reducing the number of publicly traded shares.

By taking the company private, the management can operate without the scrutiny of public shareholders and can implement long-term strategies without short-term pressure from the market. This is particularly appealing when a company believes that it can create more value outside the constraints of public ownership or when it wants to simplify its structure.

While other options include raising equity capital, rewarding shareholders, or paying off debt, these do not represent the primary aim of a tender offer. Raising new equity capital typically involves issuing new shares rather than buying back existing ones. Rewarding loyal shareholders might happen through dividends or additional share offerings, but not specifically through a tender offer. Paying off debt is generally a separate financial activity and not the core intention behind conducting a tender offer.