BBVA’s bid to buy Banco Sabadell hit by lengthy competition review

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CNMC (National Commission for Markets and Competition), Spain’s independent regulator told the banking giant. BBVA announced its takeover bid for Banco Sabadell more rigorous competency testing will be required. It was another blow to the hostile takeover, which The Financial Times said was worth about 11 billion euros and had been going on for months. The acquisition is one of the largest in the European banking industry and the resulting bank is likely to be one of the largest in Spain.

CNMC’s decision comes amid growing concerns about the possible implications of the acquisition for fair competition in banking market Spanish. Therefore, the proposal will now have to undergo the second stage of CNMC review. The regulator also raised concerns about how a possible merger could impact services such as insurance, banking, wealth management and pension plans. He The Spanish government is also reluctant offer support for this operation for anti-competitive reasons, although BBVA has already received approval of the European Central Bank (ECB).

In May of this year, BBVA initially offered 1 newly issued BBVA share for every 4.83 BBVA shares. Sabadell Bank. However, the dividend payment adjustment BBVAnow he has made a new offer to Sabadell: 1 share of BBVA for every 5.02 shares of Banco Sabadell. In addition, for every 5.02 Banco Sabadell shares, a cash payment of EUR 0.29 is offered.

Banco Sabadell continues to oppose BBVA’s hostile takeover

While the regulatory increase proposed by the CNMC may cause headaches for BBVA and delay the operation, it could be good news for Sabadell, which has always expressed its opposition to BBVA. takeover bid. Josep Oliu, president of Banco Sabadell, states in a statement published on the bank’s website: “It is clear that the merger BBVA and Sabadell “This will have a negative impact on companies, especially SMEs, as it will make it difficult for them to access credit and services due to the high degree of concentration.”

Sabadell confirmed that he considers BBVA’s offer too low.Shareholders are also concerned that the proposed BBVA shares are less valuable and riskier. He Antitrust regulators may also require BBVA to release small business clients.but very beneficial as part of a package of decisions if this agreement is carried out. Another important issue is the impact this acquisition will have on the banking market. Cataloniaand in its economy as a whole.

This is mainly because Sabadell Bank born in Catalonia, a region where there are a large number of branches of both the latter and BBVA. Thus, a potential acquisition could mean the closure of several branches due to overlayswhich will lead to job losses and economic strain.