BBVA maintains confidence in securing regulatory approval for its 12 billion euros takeover bid for Sabadell, with expectations for a decision in the coming weeks. The move aims to reduce exposure to emerging markets, with profit forecasts of 2.5 to 3 billion euros projected over the next few years if inflation stabilizes.
BBVA, a prominent Spanish banking institution, remains optimistic regarding the approval of its hostile takeover bid for the smaller rival Sabadell. Chief Executive Officer Onur Genc expressed confidence that competition authorities will sanction the bid in the forthcoming weeks, despite prior indications from the antitrust watchdog mandating a detailed review process that could extend into 2025.
The all-share offer for Sabadell, valued at over 12 billion euros, must clear scrutiny from Spain’s market supervisor, CNMV, which is currently awaiting a directive from the government before proceeding with its own decision on the potential authorization of the takeover prospectus.
A primary motivation for acquiring Sabadell is to mitigate BBVA’s reliance on emerging markets, particularly in Mexico and Turkey. Genc indicated that should inflation rates decrease, the bank anticipates achieving a net profit between 2.5 billion to 3 billion euros over the next two to three years.
In conclusion, BBVA is poised for a potential acquisition of Sabadell, which hinges on the approval of relevant competition authorities and the CNMV. Despite challenges, BBVA’s strategic intent to diversify its market exposure and forecasted profit growth in Turkey positions the bank favorably for future endeavors.
Original Source: www.marketscreener.com
