Payments under the squeeze-out procedure (mandatory buyout of shares)

What is a squeeze-out?

A squeeze-out is the mandatory sale of shares by shareholders at the request of a person (or persons acting jointly) who holds a dominant controlling stake in a joint-stock company. A dominant controlling stake refers to ownership of more than 95% of the ordinary shares of a joint-stock company. The holder of such a stake has the right to initiate a public irrevocable demand to purchase the remaining shares. To make and implement such decisions, the dominant shareholder does not need the consent of minority shareholders. They determine the procedure for the sale of shares and initiate the compulsory buyout of the remaining shares.

Escrow Account for Squeeze-Out in Ukraine

An escrow account is a special-purpose account opened in the name of the holder of a dominant controlling stake in a joint-stock company. The bank is obligated to receive and credit funds to this account, provided by the account holder. Payments to beneficiaries (i.e., minority shareholders) for the compulsory sale of shares are made from this account. The acquisition of shares in a joint-stock company through the squeeze-out mechanism is a transparent, legal, and powerful corporate governance tool. It allows the initiator (or persons acting in concert) to consolidate 100% ownership of the company by means of forced share transfer.

Payments under the squeeze-out procedure (mandatory share buyout)

The beneficiary of the escrow account (a former shareholder holding less than 5% of shares) can receive funds at any FUIB branch across Ukraine for at least five years* from the date the funds are credited to the escrow account.
*For squeeze-outs conducted before 2023, the minimum payment period was 3 years. Payments are made on business days (Monday to Friday) from 9:00 AM to 5:00 PM.

For this, the Beneficiary:

1. Visits a FUIB branch.
2. Undergoes verification and identification in accordance with the financial monitoring procedure as required by the National Bank of Ukraine (NBU).

In this case:
An individual
At a FUIB bank branch signs the “Application for payment of funds from the escrow account” and provides:

• passport
• taxpayer identification number (TIN) certificate
• documents confirming changes in personal data/unblocking, if such changes are not reflected in the payment list received by the Bank from the Joint-Stock Company.

Legal entity
At a FUIB bank branch, sign the "Application for payment of funds from the escrow account".

The payment of funds is made provided that the Beneficiary’s data fully matches the information in the payment list received from the Joint-Stock Company.

The payment list may contain outdated personal data if the Beneficiary, while being a shareholder, did not previously contact the Depository Institution where their securities account was opened.

To determine the list of additional documents required to receive payment from FUIB, the Beneficiary must know the personal data associated with their securities account. To clarify this information from the shareholders' register, the Beneficiary has the right to contact the Joint-Stock Company using the contact details provided in the “Contacts” section.

FUIB is one of the largest and most stable banks in Ukraine, enjoying the full trust of its clients. The bank provides services related to the squeeze-out procedure in Ukraine. FUIB opens an escrow account where funds for the mandatory buyout of shares are transferred.

To order a squeeze-out procedure with FUIB Bank, or for cooperation regarding squeeze-out execution and the opening or servicing of escrow accounts in Ukraine, please contact us at:
+38 (050) 250 08 42
+38 (050) 411 68 57

Information for payment service users provided before concluding an escrow account agreement

Please check the start date of payments for shares (before the start date, information is not available at FUIB branches).