Carlos Torres (BBVA) assured Sabadell that the merger proposal could not be improved
Banco Sabadell has published, through the National Securities Market Commission (CNMV), an email that BBVA President Carlos Torres sent to the President of the Catalan entity, Josep Oliu, on May 5 regarding the merger proposal. In the sent text Carlos Torres assures Oliu that the merger proposal cannot be improved.
The BBVA president explains that it is “very important” that the Sabadell board of directors knows that BBVA “does not have the opportunity to improve its economic conditions.” Torres reminds him of the offer of one share for 4.83 Catalan bank, which at the time of the offer is equivalent to 2.26 euros per share. In this sense, he emphasizes that the offer represents “a significant premium of 30% compared to prices on April 29.” But he clarifies that the premium is 48% compared to the prevailing prices when his board in mid-April considered it a figure that is much higher than the premium we were then considering to start negotiations.
That is, “in our proposal, we have already exhausted all the space we had, maintaining a premium of 30% despite the significant relative increase in your shares from mid-April to April 29,” Torres says.
In the email, BBVA’s president also mentions the decline the company has experienced in the stock market since launching the offering and adds that “there is no more way to rise” because capitalization decreased by more than 6 billion euros during this period. “This situation absolutely does not allow us to pay more premium than we already offer, because if we did, it is foreseeable that our value would fall again (even by an amount greater than the premium increase we would make) “, he states decisively.
Torres also refers to the fact that the messages received from investors and analysts over these five days are equally clear in this sense and therefore coincide with their analysis regarding the economic implications of the transaction for BBVA. The organization’s president concludes the email by providing any clarification Oliu may need.