BBVA and Banc Sabadell already explored a merger in November 2020 without reaching an agreement. The operation was not possible because Sabadell, chaired by Josep Oliu, did not accept the assessment put on the table by BBVA, chaired by Carlos Torres. The differences over subsequent governance at the bank that followed the merger also did not favor the operation, which was actually a purchase given the larger size of BBVA. Mergers always break down due to the valuation and distribution of power in the new council.
This Tuesday the operation has resurfaced again. BBVA has approached Sabadell to explore a merger. The entity chaired by Oliu points out that “it will adequately analyze all aspects of the proposal”, while its shares skyrocket on the stock market by 7% in the first reaction.
The failure of that first operation marked a change in strategy in the Catalan entity. CEO Jaume Guardiola was replaced by César González-Bueno the month after negotiations between BBVA and Sabadell broke down.
Since then, the new chief executive has implemented a plan that highlights the commitment to the digital business and the restructuring of the British subsidiary TSB.
As a result of the failure of the merger, president Josep Oliu left executive functions, although he remained in office.
In recent months, rumors had emerged about the possibility that Sabadell would resume some corporate operation to gain size, such as a possible integration with Unicaja. The president of Sabadell always ruled out that possibility.
Sabadell is now the fourth Spanish bank after CaixaBank took control of Bankia.
After the failure of the merger, in March 2021 the reorganization of Sabadell’s businesses in Spain was announced, with a new organizational chart that highlighted the incorporation of the former financial director of Bankia, Leopoldo Alvear.
The new strategic plan was presented in 2021. The bank highlighted that, in addition to strengthening the dominant areas in SMEs and companies, the plan contemplated making TSB profitable. It has since regained favor with investors. Sabadell’s share has appreciated more than 400% since the beginning of 2021, going from 0.35 cents per share to approaching 2 euros with the rise recorded this Tuesday after the announcement of the approaches.
The performance on the stock market is equally positive so far this year. The bank has recorded more than 60% revaluation, the highest increase within the Ibex 35. The results of the first quarter, in which it earned 308 million euros, 50% more, have been the latest boost.
