Mandatory Bid Rule

The Mandatory Bid Rule is a regulation that requires a person or company wanting to acquire a significant percentage of shares in a public company—typically 30% or more—to make a public offer to buy the remaining shares at a fair price. This rule aims to protect minority shareholders by ensuring they have the opportunity to sell their shares under the same conditions as major shareholders. It promotes transparency and fairness in the market, preventing potential takeovers that might disadvantage smaller investors.