BBVA can offer to buy Sabadell Bank shares from Monday as hostile bid moves into decisive stage in Spain
SPAIN’S stock market regulator, the CNMV, gave the green light on Friday to BBVA to attempt to get the majority of voting shares in Banco Sabadell.
It means that its €14.9 billion hostile bid for Sabadell will officially begin on Monday.
Sabadell shareholders will have until October 7 to decide whether to sell or stay, with results of the bid expected by October 14.
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The bidder will offer a new BBVA share per Sabadell share plus a cash payment of €0.70.
Sabadell is Spain’s fourth largest bank and is owned by a multitude of investors, but none of them has more than a 7% holding which makes the outcome of the hostile takeover somewhat unpredictable.
Unsurprisingly, BBVA’s Chief Executive, Onur Genc, said: “We already have the deal up and running. It’s a great offer with a lot of value creation potential. Let’s get it done.”
Banco Sabadell recently sold its UK TSB subsidiary to Santander, weakening their appeal as a merger target and increasing its efforts to repel BBVA’s interest.
Sabadell also boosted dividend payouts to shareholders.
In July, it announced a new strategic plan to deliver €6.3 billion of returns to shareholders over the next three years as it kicked off a programme to accelerate growth.
Fearing that a BBVA-Sabadell merger could reduce competition, the Spanish government imposed strict conditions such as that both entities must operate independently for at least three years- perhaps up to five years.
BBVA has taken that matter to the Supreme Court and the European Commission has also launched a probe over the government exceeding its powers.
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