The National Securities Market Commission, CNMV, Yesterday the approval of the BBVA OPA brochure about Sabadell 16 months after the offer was known. The document includes changes with respect to its previous version, but the key to the owners of Sabadell, the price, remains intact. The ball is on its roof and since Monday they can go to the acceptance period.
What does BBVA offer?
BBVA offers a new emission action and a cash component of 70 gross cents per 5.5483 Sabadell titles. It maintains unchanged the minimum acceptance threshold to continue with the OPA in 50% of the voting rights plus one (49.3% of social capital). Of course, leave the door open to 30%. This possibility would raise the cost of the operation because the Opply Law forces to launch a 100% offer of the company and already pay everything in cash.
Will there be improvements?
Investment banking insists that the offer should be improved between 2,000-2,500 million euros (US $ 2,343-US $ 2,929 million), Although there are sources that ensure that this figure may have been expired in view of Sabadell’s results and strategy.
The same sources believe that there will be an improvement of the offer And there will be about 2-3 days before the acceptance period is over and believe it would be retroactive so that those Sabadell shareholders who had already come to the exchange benefit.
Despite this, There are sources that believe that the possibility of lowering the acceptance threshold to 30% is a sign of pragmatismnot only to avoid the bid, but would have no need to improve the price of the offer to convince more shareholders, which is the trick that Sabadell’s shareholders play.
What is the acceptance period?
It starts next Monday, September 8 and will last a month, until October 7. According to the estimated calendar, on October 14 it is planned to publish the result of the offer and closing of this would be between October 17 and 20. Of course, if I decided to expand the deadline, you can only do it 10 days in 10 days (for the discarded moment). In this case, I could end at the beginning of November.
Steps for Sabadell’s shareholders
Those who decide to attend must communicate with the depositary entity of their actions to execute the exchange proposed in the offer.
Antonio Castelo, by Ibroker Global Markets, warns that The reduction of the minimum percentage of acceptance “significantly changes” the panorama for Sabadell’s shareholders. Their decision to accept or reject the OPA is complicated because they must take into account that, if BBVA stays with that 30%, the assessment of the shares can change for the weight of BBVA in the capital and its measures, or, if BBVA stays between 30% and 50% of the capital, they could enjoy a higher price than the current offer in case of a mandatory OPA.
In one of the documents sent by BBVA to the US supervisor, it is stated that Sabadell will be excluded from contribution if acceptance reaches 90% of the capital.
BBVA and Sabadell’s key movements
BBVA has raised the synergies that, he considers, will achieve with the fusion. They elevate them at US58.60 million compared to the initial forecast of US $ 996.11 million, up to US $ 1,054. It plans to reach in 2029 the total synergies. BBVA believes that its offer now has more value, although it has not varied, because “since we present the offer, the US $ 14,062 million in which we valued Sabadell have passed to US $ 20,391 million, 43% more,” says BBVA.
“I think it is positive for BBVA that has been able to improve synergieswhich also translates into an impact on the benefit per action of 5%, compared to the previous 3%, and has dissipated the doubts that existed on a potential dilutive impact. Despite this, we continue to think that if you want to have options to get ahead you should improve the offer, “says Nuria Álvarez, of rent 4.
Sabadell refers to his strategic plan to defend his ability to grow alone. It has pledged to increase the profitability of 16%, with a growth greater than the average of its competitors in several plots that would result in a benefit to the conclusion of the plan in 2027 of US $ 1,875 million. Analysts described the plan as “robust” and with “options” to be fulfilled.
What dividends are expected?
BBVA would review Sabadell’s remuneration policy because its 60% pay-out could be “inferior, equal to or superior” to now. In addition, he points out about the dividend of US $ 2,929 million for the sale of TSB, which even having been approved at the Board, there is no security to be distributed, since it is subject to the consummation of its sale.
Sabadell has pledged to distribute US $ 7,382 million in dividends until the conclusion of the strategic plan in 2027. The first disbursement will be US $ 1,523 million between cash and repurchases charged to this year’s accounts. On August 29 he already paid 7 gross cents per action. The next payment will be in December. In 2026 it will disburse the rest of the corresponding to 2025 and the extraordinary of US $ 2,929 million for the sale of TSB.
BBVA says it will distribute US $ 42,188 million to its shareholders via effective and repurchase of titles until 2028. He hopes to have US $ 28,125 million to pay ordinaryly and another 12,000 in charge of excess solvency over 12%. All after generating US $ 56,251 million of benefits, with an average profitability of 22%.
