César González-Bueno (Madrid, 1960) is experiencing first-hand one of the most important events in the recent history of the Spanish banking sector. Despite himself, he has become one of the main protagonists in the hostile takeover bid launched by BBVA in May to buy Sabadell. The CEO has the mission of staunchly defending the solo path of the fourth largest bank in Spain and convincing both investors and shareholders of this. The latter will have to decide whether or not to accept the exchange of shares under the same conditions that the top management has already rejected.
In an interview with They got upexhibits confidence and tranquility in equal parts, and he believes that Sabadell’s history will be forged without BBVA. As an anecdote, he smilingly shows the clock that measures his hours of sleep: “I sleep the same or better than before,” he says ironically.
The board of the Catalan entity rejected the offer of one new BBVA share for every 4.83 Sabadell shares. But, with the hostile move, Not even a price improvement would bring the two sides closer together. “The law prevents us from sitting down again. It’s not that we don’t want to negotiate, it’s that there is no longer a legal channel,” explains González-Bueno, who admits, however, that he “likes Carlos Torres, president of BBVA and exMcKinsey like him.
In any case, as he clarifies, the Sabadell board would have to issue a recommendation to its shareholders if the acceptance period for the takeover bid begins, which would have to be “reasoned” to justify whatever its orientation.
Sabadell’s CEO warns that large investors, with funds such as BlackRock present in both shareholdings, “like” mergers, but only if they involve “little risk of execution”. And on this point, he says doubts on the table on the synergies of a possible integration, the impact on competition and, above all, the opposition of Moncloa.
Trust in David Martinez
“Institutional investors say that they will make the decision at the right time. It is one thing to be happy with a national merger, but another thing is that they still lack a lot of information on the table. And the value of the operation depends on whether or not there is a merger,” he reasons. He is confident in the intentions of the Mexican investor. David Martinezwhich controls more than 3% of the Catalan entity and is the only relevant individual shareholder.He is optimistic and in the last meeting he was full of praise for the results”reveals.
“González-Bueno believes that the Government will not change its mind about the takeover bid because competition problems and the impact on the economy are not temporary arguments.”
Sabadell’s CEO is not afraid that BBVA will end up convincing the government as a result of its courtship and bring about a change of opinion. “There may be a competition problem and that could have an impact on the economy. It is not a passing argument. That opinion may have a good chance of being sustained over time,” he argues.
Breaking up SME businesses?
As a strong argument about the uncertainties of the operation, González-Bueno gives the example that BBVA could be forced to sell part of the SME business Sabadell due to competition issues if the takeover bid is successful. And remember the case of Popular with Santander, which acquired it in 2017 and lost half of its credit and 67% of its loans to companies two and a half years after the integration.
“Sabadell handles internal surveys in which the majority of clients, especially SMEs, admit that they would leave the bank if the entity is finally absorbed by BBVA
“In the SME business, one plus one is not two.. Because customers want to have several banks and banks do not want to provide all the needs of a single customer. We already saw this with the merger of Popular and Santander,” warns the CEO of Sabadell. It should be remembered that Popular was the leading bank in SMEs and its great attraction was this segment of customers, a situation similar to that of Sabadell. “But the Popular is no longer there and the competition would not be the same,” he points out.
For this reason, he does not rule out BBVA having to sell part of its SME business to another entity to avoid competition problems, something that would, in his opinion, reduce the “great value” of Sabadell.
“Sabadell has already announced two dividend improvements following the announcement of the takeover bid. It expects to distribute 2.9 billion among its shareholders in the next two years.
But González-Bueno goes further and says that the bank handles internal surveys in which the majority of clients, especially SMEs, acknowledge that they would leave Sabadell if it were absorbed by the La Vela group. “Many clients would leave for Don’t have all your eggs in one basket“, he says.
The CEO of the Catalan bank guarantees that he only thinks about keeping Sabadell as an independent and solitary entity. And despite its strong capital position, He assures that he will not launch “any takeover bid” for Unicaja or any other entity. It will focus on increasing the dividend, after announcing this week an improvement of 500 million, the second since the announcement of the takeover bid. Its objective is to distribute 2.9 billion among its shareholders over the next two years in an attempt to convince them that the bank has potential on its own.
Source: www.vozpopuli.com
