Ukrainian President vetoes squeeze-out law “On Joint Stock Companies”
2011-01-13 16:59:08
President Viktor Yanukovych vetoed amendments to the law “On Joint Stock Companies”, which would have allow owners of a 95% stake in a company to require minorities to sell shares.
The squeeze-out law was vetoed on the grounds that it violated constitutional principles. In addition, the President recommended that public joint stock companies hold a listing on one of the Ukrainian stock exchanges.
"The news is positive for Ukrainian equities. The President’s veto and proposed amendments is a strong indication that the squeeze-out clause will be excluded from the final version of changes to the law “On Joint Stock Companies”. Hence, the long-discussed risk of a significant reduction in stock market liquidity through mandatory buy-out of minorities has been invalidated by the President’s decision," Phoenix Capital informed.
Potentially more liquidity could be introduced into the market through the obligatory stock market listing of public joint stock companies.