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Reuters
11 hours ago
- Business
- Reuters
UniCredit drops bid for Banco BPM blaming Italy's government
MILAN, July 22 (Reuters) - Italy's UniCredit ( opens new tab withdrew its takeover bid for smaller rival Banco BPM ( opens new tab on Tuesday, blaming government intervention for scuppering the 15 billion-euro ($17 billion) deal. UniCredit's swoop on BPM, and a similar hostile bid by Spain's BBVA ( opens new tab for Sabadell ( opens new tab, which also faces state opposition in Madrid, have seen European governments emerge as key players in banking mergers. While European authorities have urged the bloc's players to gain scale to counter expanding U.S. rivals, some governments are reluctant to sanction deals that may lead to job losses or excessively distance lenders from local communities. "This is a missed opportunity not only for BPM stakeholders but also for Italy's businesses, communities and wider economy," UniCredit said in a note. The decision comes after Italy's markets watchdog on Tuesday, for a second time in two months, decided a 30-day suspension of the offer saying disputes over the government's conditions for a deal created excessive uncertainty. Three people familiar with the matter told Reuters that UniCredit had been ready to ditch the all-share bid ahead of the Consob watchdog's decision, as the regulator had not been expected to grant a full extra month. UniCredit said Consob's decision, though welcome, was not enough to get to a situation where all uncertainty around the bid would be removed. The sources said concerns over UniCredit's strained relations with the government had prevailed within the board. The withdrawal marks a setback for UniCredit CEO Andrea Orcel, a veteran dealmaker UniCredit hired in 2021 for his merger and acquisition skills. UniCredit could resubmit the bid in the future if Banco BPM fails to join in the consolidation frenzy gripping Italian banks. Italy's second-biggest lender had challenged in court the conditions imposed by Italy on the deal on grounds of national security, saying they would damage the enlarged company. A court ruling this month axed some of the conditions, but left intact a demand that UniCredit cease operations in Russia, apart from payments handled for Western companies. The European Commission has also criticised Rome's interference in the deal, saying that it could order the government to forgo the conditions altogether. Consob said in Tuesday's decision that the uncertainty caused by the court ruling and the Commission's scrutiny made it too hard for BPM shareholders to take a view on the offer. Prior to the suspension, the offer had been due to expire on Wednesday. With Banco BPM's market capitalisation higher than the bid's value, at 15.4 billion euros, take-up stood at just 0.5%. UniCredit unveiled its offer in November, with Orcel saying the bank could not be sidelined as the sector embarked on long-awaited consolidation. UniCredit has also expressed an interest in tying up with Germany's Commerzbank ( opens new tab, acquiring a 20% equity stake and a further 9% in derivatives, a move staunchly opposed in Berlin. ($1 = 0.8554 euro) (This story has been refiled to remove an extraneous word in paragraph 2)
Reuters
2 days ago
- Business
- Reuters
Spain's BBVA says expects acceptance period for Sabadell bid to start in September
MADRID, July 21 (Reuters) - Spain's BBVA ( opens new tab expects the acceptance period for its takeover bid for smaller rival Sabadell ( opens new tab to start in early September, rather than at the end of July as initially planned, a spokesperson for BBVA said on Monday. The spokesperson for BBVA said this would allow the bank to include the most up-to-date information in its takeover prospectus such as the outcome of Sabadell's extraordinary meetings on August 6. Sabadell shareholders are summoned to vote on the agreed sale of its British unit TSB to Santander ( opens new tab and also on the extraordinary 2.5 billion euros ($2.92 billion) cash dividend it plans to distribute among shareholders thanks to the proceeds of the divestment. The decision to dispose of TSB offers Sabadell a potential defensive play as it seeks to stop BBVA's over 13 billion euro takeover approach, aimed at creating Spain's second-biggest bank by credit volume after Caixabank ( opens new tab. A spokesperson for the Spanish stock market supervisor said that it considered as "adequate the proposal put forward by BBVA so that shareholders of Sabadell can have all the information" before deciding whether to tender their shares. In Spain, legislation requires the governing bodies of a company targeted in a takeover bid to request shareholder approval before promoting or taking any action that might prevent an acquisition from succeeding. BBVA decided to proceed with the Sabadell bid despite the Spanish government blocking it from fully merging with its smaller rival for at least three years as one of the conditions imposed on the planned transaction. The takeover prospectus is expected to be approved before the acceptance period, spokespeople for BBVA and the CNMV said. ($1 = 0.8555 euros)
Yahoo
4 days ago
- Business
- Yahoo
European Commission challenges Spain's BBVA-Sabadell merger block
The European Commission (EC) has taken legal steps against Spain, challenging its decision to block the BBVA and Banco Sabadell merger. According to the EC, Spain's actions contravene European Union rules, potentially impacting the region's banking consolidation efforts. The EC has sent a formal notice to Spain, demanding a review of its decision to impose a three-year moratorium on the BBVA-Sabadell merger. In a statement, the EC said it 'considers that certain provisions in the Spanish banking law and in the Spanish competition law, which grant the Spanish government unrestricted powers to intervene in mergers and acquisitions of banks, impinge on the exclusive competences of the European Central Bank and national supervisors under the EU banking Regulations'. The executive branch of the bloc went on to say that it also 'considers that those broad discretionary powers constitute unjustified restrictions to the freedom of establishment and of capital movements'. Spain's economy minister Carlos Cuerpo, as reported by Reuters, said the country's regulations are in line with those in Europe and that the infringement procedure will not affect the cabinet's decision. "These are two parallel we hope that in the end our legal and technical position will prevail, namely that these two regulations are perfectly aligned and that the government's actions have been entirely appropriate," Cuerpo was quoted as saying. Under Spanish law, while the government cannot prevent BBVA from purchasing Sabadell's shares, it retains the authority to decide on the merger's progression. Despite the conditions, BBVA has decided to proceed with its €13bn ($15.11bn) acquisition bid, with the deal currently awaiting approval from Spain's stock market supervisor. Spain now has two months to respond to the Commission's concerns. If the response is unsatisfactory, Brussels may issue a reasoned opinion and could eventually refer the case to the Court of Justice of the European Union. Euro zone banking supervisors have advocated for banking consolidation to bolster the sector, though such deals have been limited due to political efforts to safeguard jobs and domestic banks. The Commission said: 'Consolidations in the banking sector benefit the EU economy as a whole and are essential for the achievement of the Banking Union. These mergers also ensure that capital is allocated efficiently across the EU and that citizens and businesses have access to financial products at competitive prices – a key objective of the Savings and Investments Union.' Both BBVA and Sabadell have declined to comment on the EC's legal action. "European Commission challenges Spain's BBVA-Sabadell merger block " was originally created and published by Retail Banker International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Fashion United
5 days ago
- Business
- Fashion United
El Corte Inglés completes 500 million euro debt issuance
Madrid – El Corte Inglés, the Spanish department store group, has successfully completed a debt issuance totalling 500 million euros. The placement was executed through a bond issue with an interest rate of 3.5 percent and a maturity date in July 2033. According to details provided by the Spanish company's management, the transaction received support from seven prominent placing entities, encompassing both Spanish and international financial institutions. These included Barclays, BBVA, BofA Securities, Caixa Bank, Citi, Goldman Sachs, and J.P. Morgan. An additional nine entities also participated in this financial endeavor: Banco Sabadell, BNP Paribas, Crédit Agricole, Deutsche Bank, Intesa SanPaolo, Kutxabank, Banco Santander, Société Générale, and Unicaja. Legal advisory services for the operation were provided by Linklaters and Allen&Overy Shearman. Aimed at qualified investors, this marks the second debt issuance undertaken by the company, chaired by Marta Álvarez, since it received an 'Investment Grade' credit rating from the debt rating agency S&P in June 2024. This enhanced credit status appears to have significantly contributed to the strong demand for the bonds, with subscriptions exceeding the available supply by approximately nine times, as emphasised by El Corte Inglés management. The 500 million euro bonds will yield an annual interest of 3.5 percent for their holders and have been issued with an eight-year maturity, set for July 2033. Regarding the strategic purpose of this debt placement, El Corte Inglés stated that the issuance will enable the company to diversify its financing sources. The new funds, now added to its balance sheets and accounts, are designated for 'general corporate needs,' without specific mention of any particular project or strategic initiative for their deployment. This 500 million euro bond issue follows a reduction in the company's net financial debt by 263 million euros during the 2024 financial year. In summary El Corte Inglés completed a debt issuance of 500 million euros, with demand exceeding supply by approximately nine times. The bond issue has an interest rate of 3.5 percent and matures in July 2033, backed by domestic and international investors. The funds will be used for general corporate needs, and have been raised after a reduction in net financial debt in 2024 of -263 million euros. This article was translated to English using an AI tool. FashionUnited uses AI language tools to speed up translating (news) articles and proofread the translations to improve the end result. This saves our human journalists time they can spend doing research and writing original articles. Articles translated with the help of AI are checked and edited by a human desk editor prior to going online. If you have questions or comments about this process email us at info@
Reuters
6 days ago
- Business
- Reuters
EU challenges Spain for hindering BBVA's Sabadell bid
MADRID, July 17 (Reuters) - The European Commission officially challenged the Spanish government on Thursday over its attempts to hinder Spanish bank BBVA's ( opens new tab hostile bid for smaller rival Sabadell ( opens new tab. A letter of formal notice, which opens an infringement procedure, was sent to Madrid after the government last month said BBVA would not be allowed to integrate its operations with Sabadell for at least three years as one of the conditions imposed on the more than 13 billion-euro ($15.05 billion) offer. The letter said that, in the Commission's view, provisions in Spanish banking and competition laws granting the government unrestricted powers to intervene in mergers and acquisitions "impinge on the exclusive competences of the European Central Bank and national supervisors under the EU banking regulations". The Commission's letter, which comes after a warning in May not to hinder the bid, also said that it considered Madrid's broad discretionary powers as unjustified restrictions on the freedom of capital movement. An economy ministry spokesperson said the regulations have been in force for several years and applied on several occasions, and the government intended to explain and clarify any legal or technical differences as part of constructive cooperation with the EU institutions. Spain has now two months to respond and address the shortcomings raised by the Commission. In the absence of a satisfactory response, Brussels may decide to issue a reasoned opinion and urge Spain to comply and could ultimately refer Spain to the Court of Justice of the European Union. Euro zone banking supervisors have called for banking consolidation to strengthen the sector, but deals have been scarce as politicians have sought to preserve jobs and protect home-grown lenders. The Commission also said consolidation was essential for achieving a bloc-wide banking union. BBVA decided to proceed with its bid despite the condition imposed by the government and the deal is now waiting for approval from Spain's stock market supervisor. BBVA and Sabadell declined to comment on the European Commission's move. ($1 = 0.8639 euros)
