BBVA analyzes a possible merger with Sabadell

Madrid. Banco Bilbao Vizcaya Argentaria (BBVA) informed the National Securities Market Commission (CNMV) that it had begun negotiations with the executives of Banco Sabadell for a hypothetical merger with the financial entity of Catalan origin, which would represent one of the strategic movements of greater relevance in the Spanish banking system.

This is the second time that BBVA has attempted to purchase Sabadell, one of the most prestigious banks in the select sector of commercial banking with high purchasing power and which has a presence in Spain and other countries, including prominently in Mexico.

In the letter, the financial entity warns that “BBVA confirms that it has appointed advisors for this purpose”, alluding to the intermediation for the negotiation of the consulting firms UBS and JP Morgan, while Garrigues would be in charge of legal advice on behalf of BBVA. .

The Catalan bank confirmed the interest and the maneuvers, in another relevant fact in which it reported that “Banco Sabadell confirms that it has received at 1:43 p.m. today an indicative written proposal from Banco Bilbao Vizcaya Argentaria for a merger. The Board of Directors of Banco Sabadell will adequately analyze all aspects of the proposal.”

The reaction of the markets to the hypothetical merger was immediate, in which Sabadell’s shares, which had been going through a day of slight declines, soared after the news was confirmed and reached a revaluation of around 6.5 percent, which places them at 1.85 euros. On the contrary, BBVA shares fell almost 6 percent.

If the operation goes ahead, the resulting entity would become the second banking group in Spain and the third in Europe, behind Santander and BNP Paribas. Taking Monday’s capitalization as a reference, the merged group would have a stock market value of around 70 billion euros.

It is not the first time that both entities have approached a merger operation, which they already attempted in 2020, when there was an approach that ended up being frustrated two weeks after the contacts became known. Both entities then announced the breakdown of talks. BBVA preferred not to give explanations, but Sabadell revealed that they had not reached an agreement on the final price of the operation.