Gonzalez Bueno accuses BBVA of underestimating the cost of taking over Sabadell

Sabadell CEO Cesar González Bueno assured this Thursday that the board of his company rejected the offer to buy BBVA before it announced a hostile takeover of the bank, since the operation would entail “significant” capital costs for his rival company. “more than 0.3 points calculated by the group chaired by Carlos Torres Vila. Thus, the head of the Vallesan division noted that, according to Sabadell administrators, achieving the cost reductions that BBVA foresees (synergy of 850 million euros) will cost them much more more expensive than the 1.450 million calculated by BBVA. According to his calculations, the costs will be 2.550 million, which is 75.8% more than his rival expected.

During some of the IESE banking sessions, Gonzalez Bueno spoke about the steps that Sabadell took before BBVA made its hostile bid, as the 2007 takeover law requires companies that are the targets of said takeovers to maintain a “duty of passivity.” The banker noted that his organization’s board also assessed that the cost of achieving the synergies planned by the Basque-born bank (which makes any merger meaningful) also does not include the cost of breaking up the various alliances Sabadell has in areas such as insurance or payments.

Likewise, he continued, his bank’s administrators rejected the proposal because they understood that BBVA had not included in its figures the adjustments to the value of Sabadell’s assets and its maturing debt portfolio that are made in any merger process. Also, he said, they took into account the fall in BBVA shares since the announcement of the offer (the operation was offered through a securities exchange), as well as – in an “additional” manner – the impact that the integration would have on customers and employees.

The Sabadell chief executive also said the board took into account the budgets prepared by the management team (which began in November and closed in March, before the offer was announced) and that the managers he leads have “consistently exceeded” their budgets. budgets. and achieved a 50% increase in profit in the first quarter with growth across all areas of accounts and business volumes. For all these reasons, he argues, the board of directors rejected BBVA’s offer, realizing that Sabadell shareholders would reap greater profits if the company stood alone.