Banco Sabadell Board of Directors closes ranks and unanimously rejects the OPA launched by BBVA when considering that The price «does not properly collect» the intrinsic value of Sabadell’s shares, Using «very significantly» the project of the Catalan entity.
In a report sent this Friday to the National Securities Market Commission (CNMV)The Bank points out that the best option for its shareholders is not to accept the operation raised by BBVA. «The conclusion is that the best option is not to accept the exchange,» he had abounded The president of Sabadell, Josep Oliuat a press conference.
“This OPA was born dead and only remains to be buried by shareholders”, The Catalan banker has come to point out, who believes that the offer“ is not basically acceptable because the Sabadell solo project significantly underestimate. ”As explained, it is «Worse» than the one presented 18 months agosince after the adjustments would give Sabadell a minor participation of BBVA, of 13.6%.
According to the council calculations, not only the value of the offer, of 3.04 euros, presents an 11% discount compared to current levels, but also Banco Sabadell’s potential value is “between 24% and 37% above the offer price”, Added the CEO, César González-Buenos.
The Catalan entity believes that The offer is dilutive for the benefit per share, which would lower 1% when there is no management autonomy (during the first three years); Until then, it would drop 3%. Also, see A 30% decrease in dividend distributiongiven the dividend estimates of both banks and the participation that the Nuevo Banco’s shareholders will have (13.6%).
The CEO has also assured that «We do not see a fall indicator [de la acción] If the OPA fails«, But there is a» significant revaluation potential «in the Sabadell solo project. As explained, since the Bank’s action was launched, they have increased 94%, but this increase has been similar to that recorded by its comparable ones, while the median prices of analysts has increased by 86%.
In the opinion of the banker, in addition, «There are many hypotheses that do not seem reasonable In the BBVA model ”, especially in what implies the synergies of 900 million, due to the demand of the government of at least three years of autonomy. It has also questioned that there may be synergies since the first year this period of this period.
In addition, in the SMEs sector «it is evident that when their positions are added, part of them will diversify them to other entities to avoid excessive concentration. We have seen it in all the previous mergers.» To this is added a political risk, since the approval of the fusion would mean the disappearance of Banco Sabadell «and I do not think it is easy for any political group that is in power within three or five years» to make that decision, said the CEO.
Both González-Bueno and Oliu have also influenced that now for shareholders residing in Spain «it is not neutral from the fiscal point of view.» “There are only two options, that withdraw the offer or that they upload it”, The CEO has concluded.
A second EPA in cash?
It should be remembered that If BBVA decided to withdraw the 50% acceptance threshold condition of the Sabadell Bank shareholders, and reached between 30% and 50% of the acceptance, by virtue of Spanish legislation on acquisitions would be forced to present another offer with the cash alternative.
«It has been a last minute surprise and requires more clarifying,» González-Bueno claimed BBVA. As recalled, BBVA could be forced to launch an cash bid at a fair price. «The price is probably greater and in cash, and it would not be available to the shareholders who already went to the first offer,» he added.
In addition, «it is not clear how this will be financed.» BBVA could do it with own funds, which «would affect the future dividend», or through a capital increase that «would more dilute the participation for the shareholders who went to the first offer.»
A counselor asks BBVA to improve the offer
The decision of the Council has been unanimous but has had the Abstention from David Martínez Guzmánthird shareholder of the entity with 4% of the capital. The Mexican investor also rejects the OPA when considering «unrealizable”The price raised, but is unmarked from the management by guaranteeing the integration strategy proposed by BBVA. Martínez urges the bank chaired by Carlos Torres to improve the bid and present «a competitive offer» that can achieve the majority support of the shareholders.
«With respect to the price, I respectfully request BBVA to reconsider and present a competitive offer, at a price that allows the acceptance of at least 50% of the Sabadell Bank shareholders,» he adds.
And now what?
For now, the Directorate of the Catalan Bank insists that its plan as an independent entity generates more value than integration, while the pulse with the BBVA approaches its outcome.
BBVA’s OPA on Sabadell, Authorized by the CNMV just a week ago and launched 16 months agooffers an action and 0.7 euros in dividends for every 5.5483 Sabadell titles. According to yesterday’s stock market closure, The OPA values the entity at 15.3 billion euros, a figure that the market has already exceeded: Sabadell trades 9.3% above the offer.
He Deadline for Sabadell investors to decide on October 7, while BBVA has until September 23 to upload its proposal. If he did, the Council should pronounce again, although Torres has reiterated in public that he has no intention of modifying the offer. The final resolution will be announced on October 14.
Unions calculate between 5,400 and 10,500 layoffs if there is fusion
The representatives representatives of Banco Sabadellll workers have also expressed their rejection of the OPA in a series of opinions sent to the Council before it set their opposition in the report published this Friday. Specifically, Banco Sabadell’s council has received the opinions of UGT, Intersindical, Euskal Sindikatua and Independent Union Grupo Banco Sabadell (SICAM).
UGT foresees the destruction of between 7,500 and 10,500 direct jobstaking into consideration a fork of between 40% and 55%. This fork adjusts to an employment destruction of 45.5% of the templates of absorbed banks, which is the average that has occurred in Spain in the previous “most significant” fuses examined by UGT.
The Intersindical has considered that the destruction of employment could be 5,400 people, extrapolating the figures of the last file of employment regulation (ERE) of Banco Sabadell. It has also been opposed to the closure of 300 offices that BBVAs planned. «The experiences of the latest entities absorbed by BBVA do not give us any reason to be optimistic,» says training.
On his side, Euskal Sindikatua has stated that «it is not admissible that the costs of the adjustments that could end up generating an operation of these dimensions fall on the templates through traumatic measures»; While Sicam has expressed his «firm opposition» to the OPA for being a «serious threat» for employee labor rights and for the stability of the financial system.
On the other hand, although CCOO has not sent any report to Sabadellits general secretary, Unai Sordo, if it has ruled this Friday when interviewed in TVEin statements collected by Europa Press. Sordo has warned that, in terms of employment, «the result of the entity fused over time comes to be the largest size of which it merged, which usually there are usually template reductions.»