Antoni Bassas' analysis: "Small shareholders have bought into the Sabadell-Catalunya relationship."

Today you will read the same verb on all the covers as on ours:

HeBBVA's takeover bid for Banco Sabadell has failedAnd although "fail" is already a powerful verb, we could say even more: it has failed miserably. Only 25.7% of Sabadell's capital has accepted BBVA's offer. At the beginning of the takeover bid, in May of last year, BBVA set its goal as absolute control of Sabadell, that is, everything above 50%. When it began to realize it was alone, it said that if it reached 30% it could immediately begin to take control of Sabadell. Well, it didn't even reach 30%. It stayed at 25.7%. And the first thing you should keep in mind: neither Sabadell nor, of course, the analysts who saw the possibility of reaching 30% as feasible, believed such a result.

This result It is a failure for Carlos Torres, president of BBVA, which is the second time it has failed to achieve its objective of buying Sabadell and which last night at least came out to show its face: "Finally, the operation will not go ahead because the minimum level of acceptance we had set has not been reached. I would like to thank the shareholders of Banco Sabadell who have shown their support for the merger project; for the work carried out throughout the entire process."

Torres was deeply involved, which was logical, because it was the transaction of his life. He traveled to Catalonia constantly, holding dozens of closed-door meetings with the Catalan economic sector and with journalists, selling them the benefits of bank consolidation by having European-sized banks. Torres spoke confidently and knowledgeably, but at times seemed unaware or misunderstood the true nature of what he wanted to buy: a Catalan bank very close to small and medium-sized businesses with a very militant shareholder. He couldn't break the emotional barrier of what it meant to buy a bank founded in Catalonia, a country that had already seen its savings banks disappear.

It's worth noting that the odds were almost against it. Institutional and individual shareholders held around 41% of the capital and have refused. And yet, after BBVA had said it wouldn't improve the offer, it raised it by 10% toward the end.Torres hasn't fully grasped the signs of the times, and he started by making a political mistake: he launched the takeover bid three days before last year's Catalan elections, which ultimately gave the presidency to Salvador Illa. Pedro Sánchez wasn't very happy with the idea of someone creating an element of tension among Catalan voters now that he had them closer. The purchase of Sabadell went against his narrative of reunion and the normalization of Catalonia-Spain relations. The Spanish government imposed very tough conditions on BBVA: if the takeover bid went ahead, it required three years of maintaining the Sabadell brand, for example. Everyone in Catalonia, right and left, politicians and businessmen, employers and unions, were against it. Here's the message of joy from Salvador Illa, last night.

And, of course, when investors see everyone against them, they think twice. And yet another reason for failure: hostile takeovers (which is why they're called hostile), that is, buying up a bank that doesn't want to be bought, aren't popular. All the bank mergers that have taken place in Spain have been agreed upon privately. A hostile takeover in Spain has never worked.

If we have talked about Carlos Torres, we are talking about Josep Oliu: gifted, the most brilliant student since high school at the Escolapios de Sabadell, He has a good team and has managed to build bank loyalty..

By the way, in case anyone's wondering, the law prevents BBVA from trying again for a year. For a good while, the ads stopped, of which, without a doubt, the most groundbreaking was this one.

Well, the dragon has died. Many Sabadell shareholders have shown greater loyalty to the connection between a Catalan bank and the country, and the city of Sabadell, than the bank demonstrated in 2017.

Good morning and have a nice weekend.