The board of Banco Sabadell flatly rejected a merger between the two major Spanish banks this week, but now Banco Bilbao Vizcaya Argentaria (BBVA) has approached again with a bid of 11.5 billion euros with settlement in shares, according to several media.
The offer is on the same terms as the first and corresponds to a premium of 18 per cent compared to the closing price on Wednesday. Sabadell rose 5 percent on the stock exchange in Madrid after the news, while BBVA fell accordingly.
Could become a banking giant
BBVA lures shareholders with the fact that the merged company will become one of the best banks in Europe, with a share of the loan market in Spain of up to 22 per cent.
The board of Sabadell stated earlier this week that the bid reflects very little the potential of Banco Sabadell and the company’s growth prospects as an independent bank.
If the two banks merge, it will create a Spanish banking giant with more than 1 trillion euros on the balance sheet and a total market value of around 70 billion euros, equivalent to around the same value as Spain’s largest bank, Banco Santander.
The offer requires acceptance from 50.1 percent of the shareholders in Sabadell.
– It is not an attractive offer, and we would not accept, says analyst Nuria Alvarez in Renta 4 to Bloomberg News.
