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Slovak deputies back bill on squeeze-out of minority owners

The Slovak parliament backed a bill allowing majority owners of traded companies to enforce a buy out of minority shareholders.

The legislation passed today in Bratislava, Slovakia, requires minority owners to sell their shares to a majority shareholder holding at least a 95% stake in the company, should he ask for it. This right of majority shareholders will be enforceable in courts.

The Finance Ministry has said the measure reflects the concentration of ownership in Slovak companies into hands of single majority investors, which has caused turnover at the Bratislava stock exchange to decline. The squeeze-out will allow them to work more efficiently by cutting costs on calling shareholders meetings and meeting other legal requirements, the ministry said.

The change will allow foreign investors such as Mol Nyrt, which holds more than 98% in the refiner Slovnaft AS, to gain full ownership of their Slovak units. The bill must still be signed by the president. (Bloomberg)