Minority shareholders received nearly one billion UAH since the start of squeeze-out

Since the introduction of the mandatory redemption procedure in 2017 at the request of the person holding the dominant controlling interest of 95% (squeeze out), 317 joint stock companies have gone through this procedure.

In particular, 216 of the total number of squeeze-out took place in accordance with the Final and Transitional Provisions of the Law of Ukraine of 23.03.2017 No. 19883-VIII on raising the level of corporate governance in joint-stock companies. 101 squeeze-outs were conducted according to the procedure described in Article 65-2 of the Law of Ukraine “On Joint Stock Companies”.

As of March 1, 2020, 436 million UAH of contingent storage (escrow) bank accounts opened in the course of mandatory share repurchase procedures with minority shareholders (“squeeze out”) were deposited. These funds are intended for payment to natural and legal persons who are minority shareholders of the companies where the procedure of squeeze-out procedure took place.

As of the beginning of the introduction of squeeze-out, already UAH 980 million has been paid from escrow accounts in accordance with the submitted requirements. During the share repurchase, 33,000 minority shareholders received the funds.

One of the reasons why funds may remain unclaimed is the inaccuracy or change in the address of the shareholder that he or she indicated when opening a securities account in the depository system.

“The cornerstone of squeeze-out is the procedure for determining the share repurchase price. There is a need to improve the procedure and help the parties approach a fair price. We will propose the legislative structure that will resolve this issue in the draft new version of the Law “On Joint Stock Companies” (No. 2493)”, – said Maxym Libanov, the Commissioner of the National Securities and Stock Market Commission.

HOW TO MAKE SURE THAT THE SQUEEZE-OUT PROCEDURE HAS HAPPENED IN THE COMPANY SHARES OF WHICH YOU ARE HOLDING:

Information on all the declared squeeze-outs can be found on the website of the National Depository of Ukraine at the link.

If the company is listed on the NDU website  shares of which  you own, contact the depository institution that opened your securities account for clarification.