Sabadell says that the BBVA takeover bid has worse effects on synergies, solvency and employment

This Thursday, Banc Sabadell responded officially for the first time to the hostile takeover launched last week by BBVA.

Oliver Thansan
Oliver Thansan
15 May 2024 Wednesday 16:23
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Sabadell says that the BBVA takeover bid has worse effects on synergies, solvency and employment

This Thursday, Banc Sabadell responded officially for the first time to the hostile takeover launched last week by BBVA. In a meeting between IESE and FTI, its CEO, César González-Bueno, expressed the bank's rejection of the offer and cited several factors.

Among them are those related to lower synergies than those accounted for by BBVA, a solvency of the resulting group lower than that calculated by the rival bank and negative effects on employees and clients.

González-Bueno considered that the takeover bid has been carried out “in a hurry” and expressed his doubts regarding the “30 basis points of capital loss” to which BBVA's offer alludes. The deterioration is, from his point of view, greater.

BBVA calculates that the synergies sought have a cost of 1.8 times, when Sabadell, after applying a "correcting factor", considers that it is actually higher, three times, explained the CEO. “No one is making these synergies if it is not at a cost of three times the savings generated,” he said.

He also warned that the offer does not mention the foreseeable breaking of alliances between Sabadell and companies such as Amundi, Zurich or ADL. “All of this leads to the conclusion that the impact is significantly greater than 30 basis points,” he stated.

The CEO of Sabadell has also alluded especially to the “concern” of the workers and has said that the salespeople “are on the streets more than ever.”

“When there is an offer that proposes that a 41% cost cut must be made, people rationally think that it will affect them and that generates concern about losing their job at vital moments,” he stated. “When you come across them, you see that point of concern in them.”

Initially, it was planned that the CEO of BBVA, Onur Genç, would attend the Iese and FTI conferences, but this week there has been a change in the program and no bank executive has appeared at the event.

Apart from considering, in reference to BBVA's offer, that the “impact was significantly higher than 30 points”, González-Bueno has also alluded to “the fall in share value” and “volatility”, as well as to “the social issue of impact on employees and customers.”

He has also assured that “all the directors” of Sabadell described the bank's budgets as “reasonable” and considered that “they were not contaminated by any external circumstance.” The bank, he recalled, increased its profit by 50% in the first quarter.

Sabadell's reflection has been based on comparing the value creation of the “independent bank” compared to what 16% of the shareholders would contribute as a result of the sum of BBVA and Sabadell, once the synergies have been accounted for.