Sabadell bank customers overwhelmingly reject BBVA takeover bid

Sabadell shareholders have overwhelmingly rejected BBVA's takeover bid. On Tuesday, 14 October, the Catalan company told the CNMV (national market regulator) that only 2.8% of the investors have accepted the offer. This small group barely represents 1.1% of the share capital.

The bank's retail shareholders, many of whom are also customers or employees of Sabadell, are strongly opposed to the bid. Sources have stated that "both Sabadell and BBVA expected this percentage to be low, but not so low", noting that it even came as a surprise to Sabadell chairman Josep Oliu’s inner circle. Although it remains to be seen how the other shareholders have voted, the figure already revealed is a serious setback for BBVA's aspirations to comfortably exceed the 50% acceptance threshold.

"It should be borne in mind that Sabadell shareholders with deposited securities have close ties with the bank and have been customers for years, so the decision has been very conditioned," experts explain. "We believe that the percentage of institutional investors will be higher, which will allow BBVA to reach 30%," they add. The possibility of a second takeover bid is gaining strength in the market, even among those who have rejected the deal while waiting for a better opportunity. BBVA's chairman Carlos Torres has been adamant that, in this hypothetical case, the new offer will never be at a higher price. "He also said he wouldn’t improve the first one, and in the end he raised it by 10%," a local banker told SUR.

On Friday, 17 October, the CNMV will announce the final result and the criteria for setting the price of the supposed second takeover bid, in the event that BBVA does not reach 50% and decides to lower the acceptance threshold to 30%. Sabadell's stock market performance over the next few days will be key. Torres has already made it clear that, if the CNMV agrees with Sabadell's criteria, which points to a higher price, BBVA will withdraw definitively from a process that has already lasted 17 months and threatens to drag on for a few more. For the moment, the market has reacted with some volatility and Sabadell shares closed up 1.09% at 3.26 euros, while BBVA shares rose 0.7% to 15.99 euros.

Speculation is rife, and both banks have been running the numbers for days. After knowing the vote of shareholder customers, it remains to be seen what the rest of retail customers (those who have their shares deposited in other banks), who account for around 9% of the capital, will do.

BBVA already knows that it does not have the 5% support of Zurich, which announced that it would not participate in the takeover bid in order to protect its bancassurance alliance with Sabadell. But the so-called active management funds (which account for 35% of the capital) and the liabilities, which by mandate must replicate an index and would hold around 20% of the Catalan company, also play a fundamental role. Torres told SUR that he aspired to obtain 10% of the favourable vote of the latter. He is also counting on the 'yes' of David Martínez - the wayward director with 3.8% of Sabadell. But for the figures to add up and for his proposal to go ahead, the support of these groups would have to be almost unanimous.