Why has the Sabadell takeover bid not been finalized yet? These are the next steps.

MADRIDNow that the National Commission on Markets and Competition (CNMC) has authorized, with commitments, BBVA's takeover bid for Banc Sabadell, a new schedule opens, not without uncertainty. Despite the Competition Authority's approval, the operation has not yet been finalized: neither the absorption of BBVA into Banc Sabadell, nor the merger of both entities into one. This is the schedule as of now:

First stop: Ministry of Economy

Once the Competition report is published, the transaction will be submitted to the Minister of Economy, Carlos Cuerpo. He has fifteen working days from the report's publication to decide whether to send the CNMC's opinion to the Council of Ministers. This would initiate Phase 3. "Maximum caution," indicated sources from the Ministry of Economy on Wednesday night, explaining that, once they had the report, they would analyze it with "rigor and detail."

Second stop: Council of Ministers

Considering that Carlos Cuerpo (PSOE) has expressed his opposition to the operation, although he recently toned down his tone, everyone assumes he will submit the CNMC report to the Council of Ministers so that he can express his opinion. Yolanda Díaz, Second Vice President and Minister of Labor, also a prominent figure in Sumar, has already urged Pedro Sánchez's administration to halt the operation. The government could also face pressure from the pro-independence parties, ERC and Junts, regular partners in the Congress of Deputies, and even the PSC. All of them have expressed their opposition to the takeover bid.

The competition law gives the Council of Ministers the power to demand greater commitments. However, these cannot be linked to competition (a function that falls to the CNMC), but rather to reasons of "general interest." Sources consulted by ARA suggest that the government could add commitments linked to territorial or social reasons, such as Sabadell's stronghold in Catalonia or the potential loss of jobs, especially skilled ones; but also linked to the economic impact of the operation. "Sabadell is a healthy, profitable entity, and that is very different from having a bank in danger," recalls a business source.

The law gives the Spanish government one month to decide from the date the Ministry of Economy submits the report. This would put us at the end of June (if the deadline expires). However, according to the Efe news agency, sources familiar with the process indicated that This period depends exclusively on the central government and, therefore, "could be extended."

Third stop: CNMV and shareholder vote

Once the Spanish government's decision is known, BBVA can proceed with the takeover bid (unless Pedro Sánchez's administration approves commitments that the Basque bank cannot afford and it backs down). It will then be the turn of the National Securities Market Commission (CNMV). The Spanish stock market regulator must approve the transaction prospectus (a huge document that BBVA has been working on for months and which details all the information about the takeover bid: impact, benefits, risks, etc.).

Once the prospectus is approved, the CNMV itself will open the takeover bid acceptance period (the key vote in which Banc Sabadell shareholders will decide whether or not to sell their shares). This period can last 30 or 70 days at most (depending on BBVA's decision). During this time, the Basque bank can improve its offer, although it has said it will not do so, in an attempt to woo Banc Sabadell shareholders. You can do so up to five days before the final vote.

Fourth stop: merger?

If 50.1% of Sabadell shareholders vote in favor of the takeover bid (the limit set for BBVA), the Basque bank will take control of Banco Sabadell. But Sabadell will initially be a subsidiary. BBVA's ultimate goal is a merger (of two banks, making one). This requires the approval of the Spanish government. The scenario of a bank being taken over, but not merged, has not been ruled out, although BBVA would then see some of the synergies (cost reductions) it has calculated with the operation evaporate. In any case, BBVA must file for the merger and has already stated that it is in no rush.