BBVA reminds that it can withdraw from the takeover bid but admits that if it fails, it could face adverse reactions.

MadridBBVA has just updated its Universal Registration Document (URD) with the potential risk factors the bank may face in the short and medium term, including those associated with the hostile takeover bid it has launched against Banco Sabadell. This is a routine document (and update) because, in addition to the risks, the latest quarterly results presented—in this case, those for the first half of 2025—must be incorporated. However, the changes added this Thursday are somewhat relevant given the context of the takeover bid. Furthermore, they come after the conditions imposed by the Spanish government on the transaction in June and after Sabadell sold its British subsidiary TSB and agreed to distribute an extraordinary dividend of €2.5 billion.

With all these elements on the table, BBVA explains that is reviewing the impact of the condition that the Spanish executive has imposed on the operation: the obligation to keep the two entities separate for three to five years. This means that even if the takeover bid is successful (BBVA and Sabadell would be integrated), the subsequent merger would not materialize until later. Specifically, the bank chaired by Carlos Torres explains that the demand from Pedro Sánchez's government "would delay the implementation of the synergies [cost savings] derived from the merger," although it does not provide details of any specific impact. In any case, it reiterates that despite the executive's status, "the takeover and integration with Sabadell creates value for the shareholders of both entities."

Regarding the sale of the British subsidiary TSB and the distribution of the extraordinary dividend, BBVA reminds us that, in accordance with the CNMV (Spanish Securities Market Commission), it may "withdraw the offer or maintain it," in line with what the bank's CEO, Onur Genç, stated last week in a press conference. Sabadell shareholders ratified both decisions yesterday, Wednesday, at two general shareholders' meetings held in Sabadell. The votes served as a further demonstration of strength for the Valles-based bank in the face of the hostile takeover bid.

Among the risks identified and linked to the takeover bid, if it fails, BBVA acknowledges that the bank's share price "could be affected or subject to fluctuations." Furthermore, the inability to carry out the takeover bid "would negatively affect the bank's reputation and could generate adverse reactions from investors and customers, as well as negatively affect BBVA's relationship with its employees and customers." These warnings have already been highlighted by the bank in various documents in recent months.