Squeeze-out of minority shareholders following successful mandatory takeover bid: rebuttable presumption of fair consideration

The Court of Justice of the European Union (Fifth Chamber), in its judgment of 27 November 2025 (Case C-567/24, Svema Trade), gives a preliminary ruling on questions referred to it by a Slovenian court concerning the equitable price in a squeeze-out requiring minority shareholders to sell their shares to an offeror who, following a mandatory takeover bid, has acquired more than 90% of the capital carrying voting rights in the company subject of the takeover bid.

The question is also of interest given the differences between the various language versions incorporating Article 15(5) of the Takeover Bids Directive into the domestic law of the Member States (‘precio justo’ for squeeze-outs in terms of the Spanish version of the Directive). Under Article 15(5), in the event of squeeze-outs requiring minority shareholders to sell their shares following a mandatory takeover bid, “‘the consideration offered in the [previous mandatory] bid shall be presumed to be fair” for the squeeze-out of the holders of the concerned company’s remaining securities. The Court states: “Some language versions of that paragraph, such as those in Greek, English, French or Portuguese, refer to a presumption without determining its nature. However, other language versions of that paragraph, in particular those in Spanish, German and Italian or, as the referring court notes, in Slovenian, use a verb that suggests that the presumption it lays down is irrebuttable”. And this is the crux of the matter: whether the presumption of fair price or equitable price in such cases of squeeze-out (with regard to the price paid in the previous mandatory takeover bid) is rebuttable or irrebuttable.

The Court concludes that it is “a rebuttable presumption that may be rebutted” in certain circumstances “provided that those circumstances have not been brought to the attention of the supervisory authority of that Member State, with a view to adjusting the price offered in the preliminary mandatory takeover bid, or came to light only after the bid was closed, at which point such an adjustment is no longer possible”.

To reach this conclusion, the Court refers to the equitable price regime in the mandatory bid addressed to all the holders for all their holdings (Article 5 of the Takeover Bids Directive), where Member States may authorise their supervisory authorities to adjust the equitable price (understood as the highest price paid for the same securities by the offeror, or by persons acting in concert with him/her, over a period to be determined by the Member States “of not less than six months and not more than 12 before the bid”, see in this regard the judgments of 20 July 2017, case C-206/16, para. 30, and of 10 December 2020, case C-735/19, para. 44), in circumstances and in accordance with criteria that are clearly determined.

In Spanish law, this is provided for in mandatory takeover bids by virtue of Article 110(2) of the Securities Markets and Investment Services Act (LMVSI), a provision that refers the specification of the above circumstances and criteria to regulatory implementation. By way of example, Article 110(2) LMVSI cites, among others, the following (reproducing Art. 5(4) of the Directive): where the highest price was set by agreement between the purchaser and a seller, where the market prices of the securities in question have been manipulated, where market prices in general or certain market prices in particular have been affected by exceptional occurrences, or in order to enable a firm in difficulty to be rescued. Among the criteria that may be included, and also following the text of the Directive, Article 110 cites the average market value over a particular period, the break-up value of the company or other objective valuation criteria generally used (omitting the expression ‘in financial analysis’ used in Article 5(4) of the Directive). Article 9 of Royal Decree 1066/2007, of 27 July, on the regime governing takeover bids, sorely in need of updating, implements the provisions of the Directive on this point.

Returning to the judgment, the Court of Justice states that the Takeover Bids Directive recognises that, in certain circumstances, an acquisition price for the securities of minority shareholders of a company, offered in the context of a mandatory takeover bid and calculated on the basis of the objective method established in the first subparagraph of Article 5(4) thereof, may prove not to be ‘equitable’ or ‘fair’ and may require an adjustment. Therefore, the supervisory authority that could adjust “upwards or downwards” the price offered in a mandatory takeover bid, could also do so in the case of a squeeze-out of holders of securities if circumstances arise which, had they been brought to its attention in the mandatory takeover bid, would have led to adjustment or, also, if faced with circumstances that came to light only after the bid was closed, at which point such an adjustment is no longer possible (circumstances which, if they had come to light before the bid was closed, could have served to justify the adjustment of the price by the supervisory authority).

The judgment further argues that if the domestic law of a Member State does not provide for the power to adjust the price offered in a mandatory takeover bid, even if there are circumstances, such as those envisaged by the Directive, which could serve to justify an adjustment of that price, only the rebuttal of the presumption of fair consideration is capable of ensuring that the price offered in the bid, in the context of a squeeze-out of holders of securities, is fair. On the other hand, it would be paradoxical to accept that, although the Takeover Bids Directive recognises the possibility of adjusting the price offered in the context of a mandatory takeover bid, a bid that each shareholder may, ultimately, decide not to accept, if a shareholder is required to sell its shares in the case of a squeeze-out of holders of securities, there is no possibility of adjusting the purchase price by rebutting the presumption established in Article 15 of the Directive.

For all these reasons, the Court rules that “the third subparagraph of Article 15(5) of Directive 2004/25/EC of the European Parliament and of the Council of 21 April 2004 on takeover bids must be interpreted as meaning that the presumption established in that provision, according to which the consideration offered in a mandatory takeover bid of a company’s securities is fair, must be considered to be a rebuttable presumption that may be rebutted in circumstances such as those set out in the second subparagraph of Article 5(4) of that directive or in the circumstances defined by the Member State concerned pursuant to that provision, provided that those circumstances have not been brought to the attention of the supervisory authority of that Member State, with a view to adjusting the price offered in the preliminary mandatory takeover bid, or came to light only after the bid was closed, at which point such an adjustment is no longer possible”.