A logo on the outside Banco Sabadell SA offices in the Banc Sabadell Tower You can also find out more about the following: Barcelona, SpainOn Wednesday, May 1, 2024.

Bloomberg | Bloomberg | Getty Images

Spanish You can also find out more about the bank by clicking here. BBVA Surprise the market with a new product. Thursday After it announced a hostile takeover bid against a domestic rival Banco SabadellOne investment firm has described the current situation as “very strange.”

The This move comes after BBVA made a separate offer of 12 billion Euros ($12.87 Billion) to acquire BBVA. Sabadell’s Board rejected Earlier in the week

The Board said Monday The initial bid of BBVA “significantly undervalues” The bank’s growth potential, and that its strategy alone will create superior value. It This position is reiterated on Thursday BBVA made its offer to all shareholders directly.

BBVA said Its takeover bid has the same financial conditions as the merger offer Sabadell’s board. It characterized the proposal — which would create Spain’s second-largest financial institution if successful — as “extraordinarily attractive.”

“We are presenting to Banco Sabadell’s shareholders an extraordinarily attractive offer to create a bank with greater scale in one of our most important markets,” BBVA Chair Carlos Torres Vila In a statement, it was said.

“Together we will have a greater positive impact in the geographies where we operate, with an additional €5 billion loan capacity per year in Spain.”

Shares BBVA’s share price fell 6% by midday London Time to go ThursdayWhile Sabadell’s The stock price grew by over 3%.

‘Not So easy!

Hostile Takeover bids do not happen often in the European Many people were taken by surprise when BBVA and the banking sector decided to move forward in this manner.

Carlo MessinaCEO of Italy’s Big Bank Intesa SanpaoloCNBC quoted a CNBC spokesperson as saying: Wednesday There were major challenges in the banking sector of the region to consolidate.

He The task was challenging, he said. “friendly transaction” In the current market climate, it was not advisable to proceed with an hostile takeover offer. “not so easy to do.”

David Benamou. Chief investment officer at AxiomBBVA said that its offer for Sabadell The reflection of “a very strange situation indeed.”

Speaking CNBC “Squawk Box Europe” On, Thursday, Benamou Offers made by the company “makes sense” The following is a list of the most recent and relevant articles. Sabadell In his opinion and from the point of view of shareholders, it was likely that this would go through. He BBVA cited that its offer represented a premium of 30% over the closing prices of both banks on April 29th.

“It echoes to the recent discussions in Switzerland with the consolidation of Credit Suisse by UBS and all the worries about financial stability,” He added.

“I think the execution of the transaction might be rather difficult, although you can argue it is the same geography, the culture is theoretically very close as opposed to a cross-border merger.”

Benamou According to a growing trend in consolidation among European It was only logical to choose banks, especially since many regional lenders are “very small” Comparing the U.S. counterparts

Signage outside a Banco Bilbao Vizcaya Argentaria SA (BBVA), right, and a Banco Sabadell SA branch, on the left. Barcelona, Spain. Wednesday, May 1, 2024.

Bloomberg | Bloomberg | Getty Images

Spain’s Economy Ministry The government rejected BBVA’s hostile bid for takeover of the company. Sabadell, “both in form and substance.”

The The ministry has also warned against the proposed deal “introduces potential harmful effects on the Spanish financial system.”

Source link