BBVA goes to everything and decided to preserve OPA (proposal of public acquisition) on Sabella, despite the conditions of the government that prevent a merger for three or five years, although the purchase is progressing, and which met in the Council of Ministers on Tuesday last week.
The bank reported on this Monday the National Commission for the Securities Market (CNMV) after the closing market is closed, which “decided not to refuse to offer and, therefore, it remains valid.” The translation is that it is the shareholders of the Catalan organization that should now find out whether they are accepting a proposal for the acquisition of BBVA.
Torres assured that “the project creates great value for shareholders of both organizations and provides a unique opportunity to create one of the most competitive and innovative banks in Europe.”
“Together,” Torres added to the press release, “we will be a more reliable subject, with a higher scale and with the possibility of increasing financing of families and companies by 5000 million euros per year, which contributes to the economic growth of our country.”
The operation received the approval of all institutions, although both the national commission for markets and competition (CNMC) and the government established “conditions” to protect “common interest”. The restrictions that did not force BBVA to surrender in his intention of a common Sabadella.
BBVA can appoint a new general director in Sabella and change the headquarters if the shareholders of the Catalan organization accept this proposal, although over the next three years there are no mergers with the Catalan organization over the next three years. The term that can be expanded to five exercises.
The demand of the government is to maintain autonomy in the management of both organizations, which will not be able to dismiss this operation or closing offices. In addition, they will have to stay during these three or five years as independent organizations, although BBVA has action control.
“Legal security and individual assets, as well as autonomous management, separate“ between BBVA and Sabadell ”to protect general interest: employment, financing for SMEs, access to customer offices. Individual operational, ”said the Minister of Economics Carlos.
“If the government changes, over these three or five years that will be found, is the bbva obligation to put reports on the table, about the independence of the two organizations. This is an element of the guarantee, since it is consistent with the terms imposed on CNMC, ”the Minister of Economics added.
BBVA draws a new scene
The initial BBVA plan was going to integrate the Sabadell into a group for 850 million savings for 850 million: 450 million costs for technology, 300 million personnel expenses and 100 million financial savings.
However, given the refusal of the first moment of the government to merge between BBVA and Sabadell, the Buyers Bank began to shuffle the script in which the Catalan organization will remain a subsidiary of the group, and Santander had more than two decades of Banesto.
The integration process usually takes a couple of years, and, in addition, an extraordinary banking tax will have a greater cost for BBVA if it integrates Sabadell, since it is progressive, so the preservation of the Catalan bank as a subsidiary will have a certain financial advantage.
On the opposite side, this is that synergism, planned on their day at 850 million, will be impossible to achieve that a priori remains attractive for the operation, and will force BBVA to recount its numbers and leads to the recognition of the bank, since it will take more time to materialize them.
In the article, an agreement of the Council of Ministers prevents how BBVA and Sabadell perform reduction of templates or branches related to the operation, although it does not close the door so that they occur if they seek to maximize the cost of each object. Initially, the bank, chaired by Carlos Torres, considered the closure of 300 offices.
Since the BBVA continues with OPA, before the shareholders decide, it remains that CNMV approves of the brochure so that the exchange period begins. This period should last at least 15 days, which become at least 30 days, but since the possibility of completing in August is not considered, and the law allows you to extend to a maximum of 70 days, it will continue in September.
From Sabadella, whose dome has been defended from the moment of the launch of the OPA, they believe that a significant part of small shareholders will have to pay taxes if they accept the exchange, because before receiving the BBVA shares they will have to sell the atmospheres of the Catalan essence and pay for the excess value that can be marked.
In addition to this, the bank was headed by Cesar Gonzalez-Well, a strategic plan lasts, which will be presented on July 24, which coincides with the results of the first half of the year to convince their shareholders of the potential of only the essence.
On this date, the bank finds out whether your British subsidiary of TSB is selling, which will give you a margin to announce the possible distribution of dividends, which may encourage shareholders to reject the BBVA Exchange proposal.
Santander makes his way to OPA
The BBVA announcement was made on the same day that Banco Santander has submitted a mandatory proposal for the acquisition of TSB, the British subsidiary of Banco Sabadell, which appreciates this organization more than 2.3 billion pounds (about 2686 million euros), according to agencies) Reuters Referring to sources close to negotiations.
Funents market funds have believed Europa Press that the bank, chaired by Josep Oliu, called the Board of Directors for Tuesday to evaluate this offer, and Barclays, whose details were not surpassed after last Friday the deadline was closed. Answering a question about this, Sabadell does not comment.
If the Council is beneficial for the sale of TSB, you must convene a shareholder council to approve the operation. OPA imposes a passivity on Sabadell, which implies that the board of directors limited his actions to prevent the success of the operation, except when the decisions are approved by the Council of shareholders, which should be called in 30 days.
