BBVA Sticks With €15 Billion Bid for Sabadell Despite TSB Sale

BBVA said on Monday that it will keep its hostile takeover offer for Banco Sabadell in place, concluding that the rival bank’s recently approved sale of its UK subsidiary TSB and the accompanying €2.5 billion special dividend do not constitute grounds to withdraw the bid under Spanish takeover rules. The offer, lodged in May 2024, currently gives Sabadell investors one BBVA share and €0.70 in cash for every 5.55 Sabadell shares, valuing the target at roughly €15 billion. Sabadell’s board has repeatedly rejected the proposal and is urging shareholders to stay independent, highlighting that those who tender would forgo the €0.50-a-share payout funded by Santander’s £3.1 billion purchase of TSB. Regulators have already cleared the deal on competition and supervisory grounds, but Spain’s government has stipulated that the two lenders must remain operationally separate for at least three years, potentially five, limiting early cost synergies. BBVA expects the securities regulator CNMV to approve an updated prospectus in early September, after which the acceptance period of 30 to 70 days will open. The bank can raise its offer or alter other conditions up to five days before the window closes and has set a minimum 50.01 % acceptance threshold for the bid to succeed.