Prague Economic Papers 2026, 35(2):221-248 | DOI: 10.18267/j.pep.912

Minority Compensation and Discount Rate Practice: Evidence from 223 Czech Squeeze-Outs (2005-2024)

Tomáš Podškubka ORCID..., Jakub Novák, Petr Jablonský ORCID...
Tomáš Podškubka, Prague University of Economics and Business, Faculty of Finance and Accounting, Prague, Czechia.
Jakub Novák, Prague University of Economics and Business, Faculty of Finance and Accounting, Prague, Czechia.
Petr Jablonský, Prague University of Economics and Business, Faculty of Finance and Accounting, Prague, Czechia.

Analyzing 223 Czech squeeze-out valuation reports from 2005-2024, this study examines discount rate construction as a governance mechanism influencing minority compensation. We document the persistent dominance of the CAPM model, a shift toward domestic risk-free anchors, and evolving practices in WACC iteration and parameter transparency. Central to this study is the introduction of a novel 12-parameter 'Transparency Index' used to statistically test the verifiability of valuation reports over time, while also analyzing the applied company-independent equity market risk premium. Our findings reveal a statistically significant rise in report transparency, a curtailed use of excessive equity market risk premiums, and their improved consistency. These trends correlate with increased judicial scrutiny and legislative reforms in Czechia, suggesting that regulatory pressure has successfully disciplined valuation practices.

Keywords: Minority shareholder compensation; Discount rate; Squeeze-out; Valuation report; Cost of capital; Transparency; Risk premium G12; G30; G32
JEL classification: G12, G30, G32

Received: October 8, 2025; Revised: February 22, 2026; Accepted: March 20, 2026; Prepublished online: June 18, 2026; Published: June 22, 2026  Show citation

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Podškubka, T., Novák, J., & Jablonský, P. (2026). Minority Compensation and Discount Rate Practice: Evidence from 223 Czech Squeeze-Outs (2005-2024). Prague Economic Papers, 35(2), 221-248. doi: 10.18267/j.pep.912
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