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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
FINANCIALS
BBVA - Sabadell... bid launched, all paper, implied value is EUR2.11 ps for SAB, 17% above closing price.
- All-paper bid so this should simply become a case of Sabadell (SABSM: BBB+ pos) spreads tightening towards convergence with BBVA (BBVASM: A3/A/A-) with two caveats.
- Firstly, competition concerns may be a barrier to completion. This is two of the top five banks in Spain merging, to generate a bank with a deposit share very close to Caixabank’s near-25% share, we believe.
- Secondly, the time factor. A deal of this size (implied value EUR11.5bn) is, at least, relatively in-market with the key overseas element being in the UK, where SAB owns TSB. BBVA has no meaningful retail presence in the UK so there appear minimal competition issues here. However, this could easily be a deal close that takes 6-9 months, in our experience.
- Graphic below shows the senior non-preferred curves for the two lenders, there may be some limited widening risk to BBVA but this a sub-20% deal for the buyer (market cap: EUR59.4bn).
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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