Latest news with #Sabadell
Mint
3 days ago
- Business
- Mint
Sabadell CEO Sees Bid for Spanish Banking Powerhouse Deadlocked
(Bloomberg) -- Banco Sabadell SA's chief executive officer said an acquisition offer by BBVA SA remains too low, leaving little prospect for plans to create a Spanish banking powerhouse. 'At this price, it's impossible for this to work,' CEO Cesar Gonzalez-Bueno said in an interview. BBVA, he said, has two options after Sabadell rejected its bid: 'Substantially improve the offer, or withdraw it.' A rise in Sabadell's shares since BBVA made its offer in May 2024 has bolstered Gonzalez-Bueno's defense against the unsolicited bid. That stance also has a measure of support from Prime Minister Pedro Sanchez's government in Madrid. BBVA has offered one newly-issued share and €0.70 in cash for each 5.3456 ordinary shares of Sabadell. That values Sabadell around €13.6 billion, compared with a market value of €15.6 billion. Sabadell shares have risen 70% since news of BBVA's interest broke in April 2024, outpacing its bigger rival's 20% gain and leaving its stock at a 15% premium to the offer price. 'If it wants to acquire Sabadell, we think that BBVA would have to increase the cash component to as much €1.00 per share' of Sabadell, KBW analyst Hugo Cruz said in a note. Paying 1 euro per share would translate into about €5.3 billion, according to Bloomberg calculations. Gonzalez-Bueno hinted at obstacles to a higher offer, echoing BBVA Chairman Carlos Torres' own warning last year that he's hemmed in by the potential impact on BBVA's share price. In its latest defensive move, Sabadell — Spain's fourth-biggest bank by assets — agreed to sell TSB, its UK unit, and pledged to return €6.3 billion ($7.4 billion) to shareholders over three years. The tussle has parallels to Italy, where government resistance tanked UniCredit SpA's unsolicited bid for Banco BPM SpA — a setback for Chief Executive Officer Andrea Orcel's efforts to reshape Europe's financial industry. The European Commission has criticized Italy and Spain for meddling in the deals. While government interventions risk violating European Union rules on the free movement of capital, Gonzalez-Bueno signaled he doesn't see a risk if BBVA's bid succeeds. The transaction as proposed is 'neutral' in that respect, he said. Spain's government has told BBVA, the country's second-biggest bank, that it wouldn't be allowed to fully integrate Sabadell for at least three years if the combination went ahead. Gonzalez-Bueno said the government's condition would reduce the deal's promised synergies to 'zero.' 'It's perfectly reasonable and honorable to change your mind' when a transaction no longer makes sense, Gonzalez-Bueno said. 'I don't think Orcel's prestige has been destroyed' by Unicredit's setback, he added. As part of its defense, Sabadell also held informal talks with Unicaja Banco SA shareholders about a combination. It also explored a potential merger with Abanca, the Expansion newspaper reported. Abanca said it's not interested. While Sabadell is open to mergers with smaller rivals, 'I don't see them in the medium term' as 'there's no appetite,' Gonzalez-Bueno said. In contrast, he said Sabadell is seeking to expand in investment banking, 'to have the market share that corresponds to us.' BBVA, formally known as Banco Bilbao Vizcaya Argentaria SA, is keeping it offer alive despite the government's conditions, saying they will only delay some of the synergies. BBVA's leaders have said they don't intend to boost the bank's offer for Sabadell for now. Sabadell last week announced the payout plan and a more ambitious profitability target along with second-quarter earnings that beat analysts estimates. The payout pledge includes a €2.5 billion extraordinary dividend from the sale of TSB, which is awaiting regulatory approval and signoff by shareholders at a meeting on Aug. 6. 'Ordinary capital creation is our best weapon' against BBVA bid, Gonzalez-Bueno said. More stories like this are available on
Reuters
7 days ago
- Business
- Reuters
Sabadell sets 2027 net profit goal above 1.6 bln euros, not counting TSB
MADRID, July 24 (Reuters) - Spain's Sabadell ( opens new tab aims to post net profit above 1.6 billion euros ($1.88 billion) in 2027, excluding results from its British unit TSB, which it has agreed to sell to Santander ( opens new tab pending shareholders' nod, the bank said on Thursday. Sabadell, which ended 2024 with a net profit of 1.57 billion euros without TSB, is seeking to fend off a 13 billion-euro takeover bid by larger rival BBVA ( opens new tab. The country's fourth-largest lender in terms of market value said it expects to lift its return on tangible equity (ROTE) ratio, a measure of profitability, to 16% in 2027 from 14.6% in 2024 as part of a three-year strategy. Without its UK arm, Sabadell aims to boost earnings growth in Spain, where the economy is projected to grow 2.4% in 2025, outpacing the euro zone average. As part of efforts to strengthen its case for remaining independent, Sabadell announced a 6.3 billion-euro shareholder payout for the 2025-2027 period. Investors will be asked to approve an extraordinary 2.5 billion-euro cash dividend, funded by proceeds from the divestment, which analysts see as a defensive move aimed at warding off BBVA. For 2025, shareholder remuneration is expected to rise to 3.8 billion euros, including a 1.3 billion-euro ordinary dividend. The bank is planning to increase payouts by at least an additional 2.5 billion euros in 2026 and 2027. In the second quarter, the lender's net profit rose 0.6% to 486 million euros, including TSB, as the sale is not expected to be closed until the first quarter of 2026. The results topped analysts' forecast of 444 million euros, helped by lower provisions. ($1 = 0.8812 euros)
Reuters
7 days ago
- Business
- Reuters
Sabadell targets profitability ratio of 16% in 2027 without TSB
MADRID, July 24 (Reuters) - Spain's Sabadell ( opens new tab said on Thursday it expected to lift its return on tangible equity (ROTE) ratio, a measure of profitability, to 16% in 2027 from a 14.6% in 2024 as part of its new three-year strategy. Sabadell, which is trying to fend off a 13 billion euros ($15.31 billion) takeover bid by larger rival BBVA ( opens new tab, said it aimed to boost profits thanks to cost controls in Spain and a 5% accumulated annual rise in overall loans over the period. This would allow it to book a net profit higher than 1.6 billion euros in 2027. Its 2025-2027 strategy comes after agreeing to sell its British unit TSB to Santander ( opens new tab for 2.65 billion pounds, which still requires the approval by Sabadell shareholders. The bank will also ask its shareholders to vote on a proposed extraordinary 2.5 billion euro cash dividend financed with the proceeds of the divestment. Analysts see Sabadell's decision to dispose of TSB as defensive move to ward off BBVA. In the second quarter, Sabadell said its net profit rose 0.6% to 486 million euros thanks to lower provisions, above analysts' forecasts of 444 million euros. ($1 = 0.8812 euros) ($1 = 0.7365 pounds)
Reuters
21-07-2025
- 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
19-07-2025
- Business
- Yahoo
£10,000 invested in Santander shares 5 years ago is now worth…
It has been a fantastic five years for Banco Santander (LSE:BNC) shareholders. The Spanish bank stock is up 216% over this time, turning every £10,000 invested back then into £31,600. On top of that, there has been a steady flow of rising dividends since they resumed in 2021 (payouts were paused during the pandemic). Including those, the five-year total return rises to almost £34,000! Lovely. Solid operational results Santander's net interest income — the profit made from core lending and borrowing activities — has been supercharged by higher interest rates in the UK, US, Europe, and parts of Latin America. In 2024, the bank posted a net profit of €12.57bn, up 14% year on year. The momentum continued in Q1 2025, with profit up 19% to €3.4bn (or 10%, excluding a one-off gain). Strong net interest income in Spain and Mexico offset weaker margins in Brazil and the UK. Return on tangible equity — a key profitability metric — rose to a healthy 15.8%, while capital buffers remained strong with a CET1 ratio of 12.9%. The bank also continued share buybacks, and it remains on track to buy back at least €10bn worth of its own shares in 2025 and 2026. Finally, the company added 9m new customers in the quarter, bringing the total worldwide to a whopping 175m. UK expansion That number will likely increase further, because in July, Santander announced the £2.65bn acquisition of TSB from Sabadell. Once completed, the two banks will serve nearly 28m retail and business customers nationwide. Earnings per share are projected to increase immediately, before adding around 4% by 2028. And the lender expects to generate at least £400m in annual pre-tax cost synergies. The acquisition further strengthens Santander's position in one of its core markets, expanding its customer base and lending capacity across the UK. This acquisition will see Santander become the third-largest bank in the UK by personal current account balances, and number four in the mortgage market. Latin America opportunity One thing I like is Santander's positioning in Latin America, where millions of previously unbanked people are joining the financial system through digital accounts. Yet while demand for credit cards, personal loans, and small business financing has exploded, credit penetration is still relatively low versus developed markets. So there's a long runway for growth ahead, which Santander is well-placed to benefit from. Nevertheless, it's still the case that Latin America remains a volatile region. Currency swings, economic instability, and high inflation can weigh on reported earnings. There's also mounting competition from nimble digital banks like Nubank (Nu Holdings), Mercado Pago (MercadoLibre), and Revolut. So Santander will have to work hard to stay competitive. Should I buy Santander stock? Despite its strong share price run, Santander looks reasonably valued to me. The stock trades at just 8.2 times forward earnings. That said, the dividend yield sits around 3.4%, which is lower than FTSE 100 banks like Lloyds (4.9%) and HSBC (5.5%). I already have HSBC shares in my portfolio for income, as well as fintechs Nu and MercadoLibre for growth in Latin America. I'm not going to add Santander to the mix too. However, the stock is reasonably priced, so investors might want to consider Santander for their own portfolios. The post £10,000 invested in Santander shares 5 years ago is now worth… appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool HSBC Holdings is an advertising partner of Motley Fool Money. Ben McPoland has positions in HSBC Holdings, MercadoLibre, and Nu Holdings. The Motley Fool UK has recommended HSBC Holdings, Lloyds Banking Group Plc, MercadoLibre, and Nu Holdings. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025
