BBVA shareholders approve capital increase for Sabadell takeover
In a recent extraordinary general meeting, BBVA shareholders approved a capital increase necessary to carry out a public takeover bid (OPA) for Banco Sabadell with 96.04% of votes in favor.
Details of the capital increase
The meeting had two main agenda items, the first being the proposal to issue up to 1,126.34 million shares with a nominal value of 0.49 euros each, totaling 551.9 million euros in share capital. These shares will be used to fulfill the consideration for the OPA of up to 100% of Sabadell’s shares, with an exchange ratio of 4.83 Sabadell shares for one BBVA share.
Implications and next steps
As this is a non-cash capital increase for an OPA, BBVA shareholders do not have preferential subscription rights. The capital increase will be fully or partially executed depending on the outcome of the OPA or the exercise of forced purchase and sale rights. Approval from the National Securities Market Commission (CNMV) and the European Central Bank (ECB) are also crucial steps in the process.
BBVA aims to achieve cost synergies of 850 million euros in three years through the absorption of Banco Sabadell, with a restructuring cost of 1.450 million euros. The bank’s experience in previous integrations supports their confidence in the success of this integration, highlighting Sabadell’s position as the fourth largest bank in Spain with assets in the UK and Mexico.
It is essential to note that regulatory bodies such as the National Commission of Markets and Competition (CNMC) are reviewing the operation to assess potential competition issues. BBVA’s strategy focuses on technology and general expenses to generate savings, minimizing the impact on staffing costs.