Spain's antitrust body extends Sabadell deal review
Longer review could extend analysis well in to 2025
CNMC could consider imposing greater concessions
BBVA says will work with CNMC to agree on remedies
Sabadell says decision illustrates deal's complexity
Updates with banks' comments in paragraphs 5-6, edits
By Jesús Aguado
MADRID, Nov 12 (Reuters) -Spanish bank BBVA's BBVA.MC hostile takeover bid for smaller rival Sabadell SABE.MC, aimed at creating a bank with assets over 1 trillion euros ($1.06 trillion), must undergo a longer anti-trust review, Spain's competition watchdog said on Tuesday.
The more in-depth second phase reviewis expected to prolong the deal process well into 2025 and also signals that BBVA may be required to make greater concessions to address competition concerns.
The opening of the second phase does not prejudge the final conclusions that the CNMC watchdog may reach, the agency said in a statement.
BBVA, which shocked Spain in May when it turned hostile in its pursuit of Sabadell with a bid worth more than 12 billion euros ($12.8 billion) at the time, relies on Mexico for more than half of its profit. Combining with Sabadell would allow it to increase lending to small and medium businesses in Spain.
A BBVA spokesperson said the lender would continue to work "constructively" with the Spanish competition body to finalise an agreement on remedies and the deal's approval "as soon as possible".
A Sabadell spokesperson said the CNMC's decision confirmed the complexity of BBVA's bid, which requires study of the deal's impact on competition in Spain's banking sector.
The anti-trust body said the first phase included a detailed investigation into competition in the affected markets and the second phase would deepen the analysis.
Moving to a second phase review could add three months to the process.
The government opposed the deal, citing concern about how its impact on competition would affect consumers.
Under Spanish law, the government cannot stop a bid from being made, but it has the final word on whether a merger goes ahead. The deal must also be authorised by the CNMV and the antitrust watchdog CNMC.
Spanish Economy Minister Carlos Cuerpo previously said that BBVA's bid could extend well into the first quarter of 2025 if the competition authorities required a more in-depth analysis.
($1 = 0.9436 euros)
Reporting by Jesús Aguado; editing by David Latona and Cynthia Osterman
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
