Sabadell CEO Predicts Board Will Reject BBVA's New Increased Offer

Sabadel's CEO, César González-Bueno, has predicted that the bank's board of directors will likely reject the public acquisition offer (OPA) from BBVA, which was revised upwards this Monday.

"If the board rejected an offer that was better, because it offered us 16.2% of the resulting bank and now offers us 15.3%; I anticipate that having appreciated twice as much as BBVA since the OPA was made, the board will probably say no," stated the Catalan bank's chief executive in an interview with RTVE, as reported by Europa Press.

The CEO of Sabadell argued that the new offer "practically has no premium," as these are usually between 30% and 40%. In this regard, he also predicted that BBVA has little chance of succeeding with this OPA.

"The chances of reaching 50% are very slim, I would say non-existent. So far, I have been quite accurate with my predictions and I don't think I will be wrong on this one, because we talk to all institutional investors and are perfectly in touch with our individual shareholders," added González-Bueno.

Sabadell has demanded that BBVA regularly disclose the acceptance level of the OPA. The executive recalled his words from Friday, stating that of the minority shareholders who are bank clients and have their shares deposited there (80% of the minority shareholders, who are slightly less than 50% of the total), "0.0%" have accepted the OPA, using the analogy of non-alcoholic beer.

Furthermore, he indicated that if BBVA decides to waive the minimum acceptance condition of 50%, the shareholders who accepted the first OPA will be stuck with that offer and will not be able to benefit from the second mandatory OPA, which must be fully cashable and at a "fair" price set by the CNMV, which, according to him, is usually somewhat higher.

In this regard, González-Bueno also predicted that the need for it to be in cash will affect BBVA's dividend distribution or cause the shareholders who went to the first OPA to end up diluted in a potential capital increase.

BBVA announced this Monday its intention to improve the offer by 10% in its OPA for Sabadell. Thus, BBVA, which previously offered one of its own shares and a cash payment of 0.70 for 5.5483 Sabadell shares, has now removed the cash component to eliminate the tax impact of accepting the OPA, and the exchange of shares will be one BBVA share for 4.8376 Sabadell shares.

Following the new price and the quotation of the two entities, which fall around 3.3% in the case of Sabadell and 1.9% in the case of BBVA, the premium is currently slightly over 3%.