Spanish Banks Takeover: Sabadell CEO Says BBVA Can't Cross 50% Threshold

Group 1 - The Sabadell Board has rejected BBVA's €17 billion takeover offer, citing various risks including fiscal impact, shareholder dilution, and labor force risks [1][2][3] - BBVA's current offer is less favorable than a previous offer made 16 months ago, with a decrease in the percentage of combined holdings from 16.2% to 15.3% [2] - BBVA's stock has underperformed compared to other European stocks, which diminishes the attractiveness of the offer for Sabadell shareholders [3][6] Group 2 - The acceptance level for BBVA's offer is currently below 1%, with significant resistance from long-term shareholders who are unlikely to tender their shares [10][11] - There is speculation that BBVA may lower the acceptance threshold from 50% to 30%, which could complicate the acquisition process [8][11] - If BBVA proceeds with a second offer, it is expected to be equal to or higher than the first offer, creating uncertainty around the potential price [12][13] Group 3 - The potential need for BBVA to raise up to €12 billion in cash to facilitate the acquisition poses significant financial risks [14][15] - BBVA's capital generation capabilities are under scrutiny, especially in light of their need to maintain dividends while managing acquisition costs [16][42] - Sabadell has demonstrated strong capital generation and profitability, with a return on tangible equity projected to rise to 16% [34][35] Group 4 - The strategic investor base of Sabadell includes 5% strategic partners, 20% passive investors, and 35% long-only hedge funds, indicating a diverse shareholder composition [19][20][21] - The long-term outlook for Sabadell's management autonomy and client relationships remains stable, even if BBVA gains control [29][30] - Sabadell's commitment to returning 40% of its market cap to shareholders over the next two and a half years reflects confidence in its financial health [34][35][45]