BBVA seeks ECB permission to submit takeover bid for Sabadell

BBVA has taken a significant step in its bid to acquire Banco Sabadell by seeking permission from the European Central Bank (ECB) to launch a hostile takeover offer (OPA). According to sources close to the request, BBVA has completed all necessary procedures to carry out this operation.

On Friday, May 24, BBVA submitted a request for authorization to the National Securities Market Commission (CNMV), which will be responsible for verifying the compliance of the information provided to shareholders with current regulations. Later on Monday, the organization submitted the same request to the National Markets and Competition Commission (CNMC), which will verify that the level of concentration resulting from the merger guarantees competition in the banking sector.

On the other hand, the ECB, despite being the last authority to which the request was sent, will be the first to approve or reject the operation. This body will be responsible for reviewing the solvency and sustainability of the merged bank’s business model.

ECB assessment

The ECB will check whether the project submitted by BBVA has adequate levels of capital and liquidity and whether it can maintain them over time. The management model and ability of the enterprise to generate profit from the merger will also be analyzed.

According to the ECB, banking consolidation can help eliminate excess capacity, improve economic efficiency and promote more tailored and credible business models. In addition, cross-border consolidation can promote risk diversification and financial market integration.

The ECB said the supervisor should remain neutral and evaluate plans submitted by authorities against technical criteria. Once the ECB decides or does not object to the takeover proposal, the CNMV may approve the transaction, allowing BBVA to open an acceptance period that could last from 15 to 70 days.

Schedule and notifications

According to BBVA, the entire process, It will take six to eight months from the time the takeover bid is announced until all approvals are received. For its part, the CNMC will take five to six months to give its approval. In addition to the approvals from BCE, CNMV and CNMC, BBVA has already notified the operation to supervisory authorities in the UK, France and Morocco due to the presence of TSB, the UK subsidiary of Sabadell, as well as the offices in which the company is located. has in Paris and the White House.

BBVA is therefore taking decisive steps to carry out a hostile takeover of Banco Sabadell, complying with all necessary procedures and approvals in a process that may take time, but which marks an important milestone in the European banking sector.