The approval of shareholders representing at least 50.01% of its share capital is required for the offer to be accepted.
The Spanish bank BBVA launched this Thursday a public takeover offer (OPA) for Banco Sabadell worth 12 billion euros, which is addressed directly to shareholders, after Sabadell’s Board of Directors this week rejected the merger proposal.
BBVA decided to move forward with the hostile takeover bid after Sabadell’s Board of Directors stated on Monday that the proposed share exchange merger significantly undervalued Sabadell’s potential and growth prospects, considering the offer was unsolicited.
The terms of the hostile offer are practically the same as the offer that was presented and rejected by the Sabadell Board of Directors.
The second largest Spanish bank by market value is offering an exchange ratio of one newly issued BBVA share for every 4.83 Sabadell shares, which translates into a 30% premium over the closing prices on April 29th.
If the operation is completed as planned, Sabadell shareholders will have a 16% stake in the institution resulting from the merger.
The hostile takeover bid values the target bank’s shares at 2.12 euros each – implying a total value of around 12 billion euros – based on the average price in the quarter prior to the announcement. Sabadell shares closed at 1.80 euros on Wednesday, according to Dow Jones Newswires.
“We presented Banco Sabadell shareholders with an extraordinarily attractive offer to create a bank with greater scale in one of our most important markets,” said BBVA president Carlos Torres Vila.
The approval of shareholders representing at least 50.01% of its share capital is required for the offer to be accepted.
The same banks considered a merger in 2020, but were unable to agree on a price and negotiations were called off.
BBVA intends to create a credit institution with more than 100 million customers worldwide and total assets exceeding one billion euros, second only to its rival Santander among Spanish banks.
Earlier this week, Sabadell’s board of directors rejected BBVA’s proposal, concluding that it substantially undervalued its potential and growth prospects as an autonomous bank.
Tags: BBVA launches hostile takeover bid Sabadell worth billion
