BBVA shares rise after Sabadell rejects takeover proposal
07/05/2024 09:08
MADRID, May 7 (Reuters) - Shares in Spanish bank BBVA
BBVA.MC rose as much as 1.9% on Tuesday morning after Sabadell
SABE.MC rejected what it described as an unsolicited takeover
proposal from BBVA.
At 0805 GMT, shares in BBVA, Spain's second-biggest lender
by market value, were up 1.5%, while those of number four lender
Sabadell were down 1.7%.
On Monday, Sabadell said its board believed BBVA's proposal
significantly undervalued its potential and growth prospects.
BBVA said it regretted Sabadell board's decision, without giving
any hint of its next move.
BBVA could now walk away, raise its offer, or launch a
hostile takeover bid. A spokesperson declined to comment.
Spanish broker Alantra said it did not expect BBVA to
improve its offer or go hostile.
"We rule out that BBVA will go hostile (...) given that the
management will destroy its track record of financial discipline
and that around 50% of Sabadell shareholders are retail
investors, which would largely follow the board's decision in
any case," it said.
The broker also said it believed BBVA would not switch into
a cash bid as it was proposing a friendly merger, and paying
cash would be inconsistent with that.
RBC Capital, however, said BBVA would likely have some
wiggle room on price, and "Sabadell has probably not fully
closed the door to future negotiations, although the two parties
currently seem a long way away from finding middle ground".
Last week, BBVA proposed offering one newly issued BBVA
share for each 4.83 Sabadell share, a 30% premium to Sabadell's
closing price on April 29 and valuing it at about 12 billion
euros ($12.9 billion).
Since then, Sabadell's shares have risen about 8.8%, while
BBVA's have fallen 9.7%, reducing the value of the proposal to
around 11 billion euros.
($1 = 0.9291 euros)
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FACTBOX-Spain's BBVA offers 12 bln euros to win over Sabadell
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(Reporting by Jesús Aguado; Additional reporting by Andrés
González; Editing by David Latona and Mark Potter)
((jesus.aguado@thomsonreuters.com; +34 91 835 68 32; Reuters
Messaging: Reuters Messaging:
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