Squeeze-out

Squeeze-out

The squeeze-out procedure means the forced redemption of the company's shares by the majority, which owns 95% of the shares. This is an approved practice to facilitate corporate governance of JSCs. In European countries, this is a proven and effective way of absorbing business, which became possible for Ukraine in 2017. Squeeze-out has a positive effect on the general state of the economy, as companies get more opportunities to attract capital from investors.

However, the redemption mechanism is still quite complex and is often associated with dissatisfaction of minority shareholders (those who own a smaller part of the shares) with the market value of shares, so we recommend holding the squeeze-out  in Lviv with the support and assistance of Ukrainian Law Firm OLSON. We know how to avoid the problems that may arise in the process of forced redemption of shares, and thus save your time and money.

Positive changes for everyone
As a result of the squeeze-out procedure, in the hands of the majority holders who own the dominant part of the shares, there is an opportunity to facilitate and more efficient management of the company and improve the liquidity of shares. They have the right to initiate the forced redemption of shares in Lviv, legally exclude from the number of participants shareholders who do not participate in the management and do not affect the state of affairs in the company. In addition, many of them may have already changed their place of residence, inherited their rights, or even lost documents proving ownership of the shares.

In another block, minority shareholders can expect to recoup their assets at a market value. And for them, such a scenario also has obvious advantages.

Difficulties that can lead to court
In Europe, the through out is carried out at the stock price of shares. In Ukraine, a very small number of companies have shares that are taken into account by stock exchanges, and therefore the market value has to be determined by an independent examination, which will prove that the proposed amount corresponds to the real value of the shareholder's share. This is the only way to protect the rights of both majoritarians and minorities.

With the proper squeeze-out of shares in Lviv, both parties are satisfied and litigation can be avoided, even despite the imperfections of Ukrainian legislation governing business.

OLSON Law Firm helps to prevent abuses by minority shareholders and will move the solution of the problem to a purely legal channel, where the parties receive a conflict-free and mutually beneficial solution to the problem.

A timely appeal to OLSON Law Firm for assistance in the forced redemption of shares in Lviv will be the first impetus to the development of convenient corporate governance of your company and a step towards new financial opportunities.