BBVA launches hostile bid of 14.8 billion euros for Banco Sabadell

Spanish banking group BBVA officially launched its hostile bid of 14.8 billion euros ($17.34 billion) for smaller rival Banco Sabadell yesterday, Reuters reports.

A possible combination of the two banks would create Spain's second-largest financial group, with assets of about one trillion euros, after leader Caixabank. BBVA is offering one new treasury share and 0.70 euros in cash for 5.5483 Sabadell ordinary shares, the equivalent of 14.76 billion euros for all Sabadell shares, based on Friday's closing prices recorded by the two banks on the stock exchange.

Sabadell shareholders have until October 7 to exchange their shares, and the results of the offer are expected to be known by October 14.

Given how the shares of the two banks have performed since the offer was first announced in April 2024, investors seem to expect BBVA to come up with an improved offer, even though the bank has officially ruled out such an option. Legally, BBVA can improve its offer until October 2, five days before the end of the acceptance period.

• Record profit for BBVA

BBVA, Spain's second-largest bank with a strong presence in Latin America and Turkey, reported a record net profit of 5.45 billion euros for the first six months of 2025, up 9% compared to the same period last year. If the euro is constant, the increase was 31%. The bank expects to generate a net profit of around 48 billion euros by 2028. Sabadell, Spain's fourth-largest bank, has taken steps to fend off a takeover, including by selling its UK subsidiary. In July, Spain's Banco Santander SA announced that it had reached an agreement to acquire Sabadell's UK subsidiary (TSB Banking Group Plc) in an all-cash transaction worth 2.65 billion pounds (around 3.1 billion euros), subject to approval by Sabadell shareholders. TSB is a UK retail bank with a nationwide network of 218 branches and points of sale and a growing digital presence. It serves around 5 million customers, mainly in the retail and small business segments, with 34 billion pounds in mortgages (2% of the UK market share) and 35 billion pounds in deposits. Combined, Banco Santander and Sabadell will serve nearly 28 million individual and corporate customers nationwide.

Founded in 1881 near Barcelona, Sabadell has a dispersed shareholder base. No single investor holds more than 7% of the shares, so the outcome of the takeover bid launched by BBVA is uncertain.