BBVA is offering Sabadell members 2.26 euros for each of their shares, representing a 30% premium.
The organization, led by Carlos Torres, calls on the Sabadell board of directors to respond to its proposal “as soon as possible.”
BBVA does not want to wait for further negotiations with the board of directors of Banco Sabadell and this morning announced the terms under which it plans to acquire the company. The group, chaired by Carlos Torres, is proposing a share swap in which Sabadell shareholders will receive bonus 30% about the bank’s share price on April 29, when it closed at €1.7375 on Ibex35. Above this level, BBVA’s offer will be €2.26 per share.
The exchange ratio for the Sabadell acquisition will be one newly issued BBVA share for every 4.83 shares of the company being acquired. “The terms contained in this offer have been approved by the BBVA Board of Directors and we are prepared to proceed with the operation immediately. Therefore we would be grateful if you Send us your rating as soon as possible. so that if we receive your support, we will be able to present the overall merger draft without delay to our respective boards of directors for final approval,” said the letter sent to Sabadell’s highest governing body, chaired by Josep Oliu.
According to the proposal sent to the CNMV, BBVA complements the price offer with a number of commitments related to the integration of the directors of Sabadell into the management of the new bank, the business, the survival of the brand or the presence of the bank in Catalonia, where the sum of the two companies will reach a market share of 40%.
The group is also sending a signal to the government, which has already announced that it will monitor competition in the banking market, which is focused on an operation in which 70% of loans and deposits will be in the hands of three banks. The degree of competition in the Spanish banking market has been called into question in recent years due to the effect of rising interest rates. If loan prices skyrocketed, the rewards on deposits were almost unnoticed.
Economy Minister Carlos Bodi warned today that the government will ensure competition and financial inclusion, while Vice President Yolanda Diaz has spoken out publicly against concentration of businesses.
BBVA has already stated in a letter sent to Sabadell yesterday that, from its point of view, the takeover of Sabadell will benefit the banking market. “The creation of a stronger and more profitable organization will gradually contribute to the economic and social development of the communities in which it is present by increasing its ability to provide credit to families and companies. This will also result in increased contribution through taxes and in growing and attractive rewards for shareholders.”