“BBVA’s takeover bid has failed because it is impossible for all the funds to come in”
BBVA’s takeover bid for Banco Sabadell faces its final blows. Almost a year and a half after the bank of Basque origin decided to launch this hostile operation – something unusual in the banking sector – the outcome is approaching. The shareholders of the Catalan entity have until this Friday to decide whether they support the plan to create the second largest bank in Spain or, on the contrary, endorse the solo roadmap of the team led by Josep Oliu. However, it will not be until the 17th when the result will be known. The CEO of Sabadell, César González-Buenoattends ‘La Información Económica’ in a few days marked by the war of figures and the verbal escalation in which both banks are engaged.
The OPA party is over. What forecasts do you have?
Yes, it’s almost over and we’re doing very well. It had been a long time since he had been so calm. The final stretch, which normally should be a very nervous phase, is being the most peaceful of all, which is surprising. We expected that the response would be good from the shareholders who are clients of the bank. Sabadell has a rarity and that is that our reference shareholders are our clients. Individuals control around 40% of the capital and of that percentage, 80% are our users with an average tenure of fifteen years. We have detected that they have barely sold more than 1%something that exceeds any of the most optimistic forecasts. Whatever calculations you make, it is extraordinarily difficult for BBVA to obtain 30% of the voting rights. It will touch the post. But of course, reaching 50% is unthinkable… A takeover bid that does not reach 60-70% is a failure.
BBVA assures that all the large funds will attend…
Such general statements have no substance. You have to say things as they are. Some institutional investors want to go and others don’t, some of them will even redeem only part of their capital. We have made little mistakes in everything we have said throughout this time. My most flattering estimate is that at most it will get a third of the supportbecause half do not agree with this operation and the rest will partially support it. The majority have not taken a public position, they simply look the other way and you have to interpret their gestures. The takeover bid has failed because it is impossible for all the funds to be available. The key is that if there is a second one (OPA) it will be more attractive. Not because it has a higher price, no one knows that. But what is impossible is that the economic compensation will be the same. The only thing that is clear is that the second one would last at least four or five months.
Has David Martínez already attended the share exchange?
It has irrevocably committed to redeem its 3.8% of the capital, therefore, we have no doubt that if it has not done so it will already do so. It’s a matter of hours.
“Sabadell has a rarity and that is that our reference shareholders are our clients”
What consequences will it have for the Sabadell board of directors if BBVA finally achieves between 30 and 50% acceptance?
I must admit that we have thought a lot about this topic. But to stay within that threshold they must launch a purchase for all the shares and pay for them entirely in cash. Then there is no longer a discussion. At this point it may happen that with that percentage they give up in the face of the risks that lie ahead. In any case, we are certain that will not exceed 50%. Therefore, this is a failed takeover bid and, furthermore, motivated by the clients it wants to serve. Your potential future clients are shouting at you that they don’t want to join your bank.
There is a difference of opinion between BBVA and Banco Sabadell regarding the price of a possible second takeover bid.
Article 9.2.e of the takeover bid regulations to which the CEO of BBVA, Onur Genç, has referred, states that “for the purposes of determining the equitable price, the full amount of the consideration that the offeror or the persons acting in concert with him has paid or agreed to pay will be included… When the acquisition of the securities has been carried out through an exchange or conversion, the “The price will be calculated as the weighted average of the market prices of the indicated securities on the acquisition date.” What is the acquisition date? The day of settlement, which is when the securities would be exchanged. On October 10, there will be an irrevocable offer from the sellers, but on that day BBVA will not yet have completed the purchase. Now, the person in charge of interpreting this law is the CNMV.
“The relationship with Carlos Torres is hibernated”
Regarding the request that the entity has requested from the National Securities Market Commission (CNMV) to monitor all those who have agreed to attend the takeover bid so that they keep their word. Have you received a response?
It is not necessary in these cases. Our warning is directed towards any investor who would be tempted to ‘play the hare’, that is, I say I am going, but in reality it is a bluff. The last few days there is usually a lot of noise. With this initiative we seek for any investor to state whether their commitment to attend is irrevocable and explain whether they have external interests apart from their shares.
CaixaBank has put on the table the need to reflect on the Competition Defense Law. Do you think the same?
A process of these characteristics cannot be so long. It ran aground at the National Markets and Competition Commission (CNMC) with an analysis that lasted eleven months. They should deeply review the criteria to be taken into account. During the first eight months, only BBVA spoke, which presented up to seven different documents, so Part of the delay is due to the ‘opador’s own actions, who tried to fine-tune the CNMC resolution down to the last word. In my opinion, they should have been more generous in addressing competition issues. If they wanted to win, they should have shortened the deadlines and been more generous with the price so that now there was no debate about whether they were going to reach 30% or not.
In its central scenario, the takeover bid does not go ahead. If this situation were to arise, would the board of directors ‘invite David Martínez to leave’?
At that time the pertinent decisions would be made.
How do you summarize these 17 months of OPA?
It has been very intense. We have grown year after year in profit and customer volume. As our president, Josep Oliu, says, “imagine what we are capable of doing when we get rid of this distraction.”
Personally, how do you get along with the president of BBVA, Carlos Torres?
I have known Carlos Torres for many years. Our relationship is old and also good, only now it is hibernated. It is neither broken nor active. It’s hibernated. When all this happens we will see, but in principle we should not have any problems.
The acceptance period closes this Friday. How are you going to experience this ‘day of reflection’?
(Laughter) With a little less intensity than what I have experienced in the last year and a half, but above all with great serenity. I am confident in the result.
