Sabadell puts the likelihood of a BBVA takeover bid going through at 27%.

BBVA shares have fallen 13.2% since the offer was announced, a drop that financial sources say cannot be attributed solely to the takeover bid.

Sabadell Bank currently estimates that the takeover bid submitted against the enterprise BBVA would have chance of success 27%because the premium offered by the buyer has been narrowed by a change in the stock caused by reasons outside the scope of this transaction.

The group declined to comment, but financial sources familiar with the estimates said The revaluation of Sabadell shares following the revelation of BBVA’s interest will be supported by “multiple factors”.and also to the good evolution of the rest of the sector, and not only because of the takeover bid.

In the same sense, the decline recorded by BBVA securities could be explained by doubts about elections in mexico and the future of the country, in addition to the purchase offer itself sent to Sabadell shareholders.

Since April 29 last year, the day before BBVA’s interest became known, Banco Sabadell’s share increased by 6.9%.which is very similar to that of comparable Spanish banks (median 4.8% for CaixaBank, Bankinter and Unicaja).

This would make them think that Sabadell’s actions does not reflect any significant premium compared to comparable Spanish banksto which it is added that the company’s securities continue to trade at the same discount compared to its competitors as before the offer.

However, BBVA shares have fallen 13.2% since the offer was announced, a drop that the same financial sources said cannot be explained solely by a takeover bidas this would take into account the negative impact of results in Mexico, BBVA’s main source of income.

For now, they highlight that the Mexican banks with which BBVA competes (Banorte, Inbursa, Banregio, Banbajío) are down 13.7% in pesos or 19.7% in euros.

If the offer fails

Following the same line of reasoning that there are other reasons for the share prices of Sabadell and BBVA than the takeover bid, one would think that if the bid had not been successful, both companies would not necessarily have had to revert to day-to-day trading. before the merger proposal.

What is most likely, the sources say, is that the market does not expect Banco Sabadell’s share to fall to €1,737 on April 29, but rather until about 1.82 eurossuggesting growth of 4.8%, in line with its peers.

In the same way, BBVA shares will also not return to €10.9. before the offering, but may be in line with its current price, reflecting a lower valuation due to its presence in Mexico, but still better than pure Mexican banks.

Taking all this into account, the implicit probability that Banco Sabadell will declare that the takeover bid submitted by BBVA will be successful will be around 27%.