(Finance) – The Spanish bank Sabadell rejected the merger offer of BBVA which would have created a European banking giant.
“After a detailed analysis of the proposal – we read in a note – the board of directors concluded that the proposal did not satisfy the interests of Banco Sabadell and its shareholders”. Therefore, the board “rejected BBVA’s proposal”.
The Board of Directors, we further read, “carefully evaluated” with its financial advisors, Goldman Sachs and Morgan Stanley, and with the law firm Uría Menéndez the BBVA proposal, a paper-for-paper offer which evaluated, at the time of launch, last April 30th, Banco Sabadell 12 billion euros, with a 30% premium on the stock market prices of the previous day. The board “has great confidence in Banco Sabadell’s growth strategy and its financial objectives and is of the opinion that the autonomous strategy” of the bank “will create more value for its shareholders” while “the recent material decline and volatility in the price of BBVA’s actions increase uncertainty about the value of the proposition.”
The Sabadell board considers the rejection “in line with the interests of customers and employees” of the bank and “reaffirms its commitment to distribute to its shareholders, on an ongoing basis, the capital in excess of a CET1 of 13%”, with the expectation of remunerating shareholders with 2.4 billion euros between 2024 and 2025, as a result of both the distribution of excess capital and ordinary dividends.