BBVA’s takeover bid for Sabadell begins its long journey this week

BBVA’s takeover bid for Sabadell begins its long journey this weekE.P.

The National Securities Market Commission (CNMV) will accept next week a brochure containing BBVA’s takeover bid for Banco Sabadell, with which the Basque entity wants to gain control of the Catalan company for its eventual merger, provided that the supervisor does not require additional information .

On May 24, BBVA formally submitted the request, in which hopes to receive CNMV approval to an operation in which he proposes to Sabadell shareholders an exchange of securities at a rate of one from BBVA for every 4.83 from the Catalan bank.

From this date, the CNMV has a period of up to 10 calendar days to accept the transaction brochure for processing, which will end early next week unless the supervisory authority asks BBVA for clarification.

In this case, the process will be delayed, since the bank will have to send the information requested by CNMV and the manager, as soon as he receives it, will again have a new period of 10 calendar days to study it before accepting the brochure for processing. In parallel, in order to gain time, BBVA has already convened an extraordinary meeting on July 5, at which it will offer its shareholders the capital increase necessary to carry out a hypothetical exchange of shares with Banco Sabadell.

Decision to submit a takeover bid

BBVA’s board of directors decided to submit a takeover bid for Sabadell on May 8 and announced it publicly the next day, explaining that the offer was made to allow the Catalan bank’s shareholders to have a choice.

In the same week, the highest governing body of Sabadell rejected a purchase offer made by BBVA on the same terms, arguing that they saw greater potential in the bank alone than as part of the BBVA group.

After a second failed merger attempt, following the first in late 2020, BBVA decided to submit a takeover offer with an exchange ratio for Sabadell shareholders that was equivalent to 50% of the listing price in mid-April and close to 30% of the share price. the day before BBVA’s interest in Sabadell was revealed.

Following the announcement of the takeover bid on May 9, BBVA had a period of up to 30 days to request permission from the CNMValthough the bank’s president, Carlos Torres, stated that they would predictably do so in two weeks, which is what finally happened.

From this point on, the CNMV began a period of 10 calendar days to decide whether to admit it to processing and then to study the terms of the prospectus sent by BBVA OPA before its approval.

The comptroller of the stock market warned it could take more than two months. review information before greenlighting a takeover bid and we are waiting for the European Central Bank (ECB), which is strictly necessary.

Once the transaction has received regulatory approval, BBVA can submit a takeover bid, even if the National Markets and Competition Commission (CNMC) has not expressed an opinion or imposed conditions. If the offer is accepted, BBVA will have to give Sabadell shareholders a period of 15 to 70 days to decide whether to sell their securities. If the bid is successful and BBVA gets more than half of Sabadell’s shareholders willing to sell, the bank will be able to put forward its final merger idea. merger of both companieswhich will be subject to the conditions established by the CNMC and the agreement of the Ministry of Economy.