BBVA, Sabadell Ditch Merger Talks
By Mauro Orru
Talks for a possible merger between Spanish lenders Banco Bilbao Vizcaya Argentaria SA and Banco de Sabadell SA have come to an abrupt finish, upending a deal that might have created a bank with a market cap of about 27.5 billion euros ($32.76 billion).
Banco de Sabadell mentioned Friday that negotiations have ended as the 2 banks failed to achieve an settlement on the exchange ratio of each entities. BBVA additionally confirmed talks fell aside.
Shares in Banco de Sabadell fell round 17% at market open, whereas BBVA was flat.
The announcement comes lower than two weeks after the 2 banks had mentioned they had been holding discussions, had appointed exterior advisors and launched into a due diligence course of.
The missed deal is a setback for consolidation within the overcrowded European banking sector, which had been gathering tempo.
CaixaBank SA in September agreed to take over small rival Bankia SA in a merger set to create Spain’s largest home bank and the nation’s third-largest bank by property.
Intesa Sanpaolo SpA additionally secured assist to amass UBI Banca, creating Italy’s largest bank by property and the eurozone’s second-biggest by market capitalization.
As prospects of a BBVA-Sabadell deal have pale, Banco de Sabadell mentioned it might consider options for value creation almost about the group’s worldwide property, together with British lender TSB.
The Spanish bank will prioritize the Spanish market as a part of a brand new plan geared toward growing profitability and creating value for shareholders.
Whereas particulars of the plan are due within the first quarter of 2021, it’s anticipated to incorporate the enlargement of the transformation program within the Spanish retail market, with a impartial influence on capital.
Pietro Lombardi contributed to this text
Write to Mauro Orru at email@example.com; @MauroOrru94
(END) Dow Jones Newswires
November 27, 2020 03:39 ET (08:39 GMT)
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Dow Jones – BBVA, Sabadell Ditch Merger Talks