Squeeze-Out Arbitration: A Comparative Analysis Between Finland and Sweden

Abstract

Squeeze-out (or buyout) is a commonly recognized technique allowing the majority (or controlling) shareholder, after reaching a predetermined ownership threshold, to gain ownership of the remaining shares in that company. For example, section 253 of the Delaware General Corporation Law (Title 8, Chapter 1 of the Delaware Code) provides that any entity holding more than 90% of a company may decide to take over the remaining shares by means of a short-form merger procedure. Also, the EU Takeover Directive requires Member States to implement rules regarding the rights relating to squeeze-out and sell-out—laid down in Articles 15 and 16. Although the Directive concerns only listed companies, some Member States, such as Denmark, Finland and Sweden, have provided similar rights in their domestic Companies Acts that cover all types of companies including listed, “public” companies (market squeeze-out/sell-out) as well as non-listed, “closed” companies (off-market squeeze-out/sell-out).