TSB’s Spanish Owner at the Heart of Merger Talks with BBVA

Speculation Surrounds Spanish Owner of TSB as Potential Takeover Target by BBVA

The Spanish owner of TSB, one of Britain’s largest high street lenders, is currently at the center of rumors that it is being targeted for a takeover by the banking giant BBVA. According to sources familiar with the matter, BBVA is in the early stages of considering an all-share bid for Sabadell, with investment bankers at JP Morgan and UBS advising on the potential deal.

Although it is unclear if BBVA has made a formal approach to Sabadell, sources reveal that preliminary discussions have taken place between top executives of the two institutions. If the takeover is confirmed, it would result in the creation of a Spanish-headquartered banking powerhouse with a market capitalization of over €72bn (£61.5bn).

The potential takeover raises questions about the future of TSB, which Sabadell has previously considered selling. In 2021, Sabadell rejected an offer from the Co-operative Bank, which is now in the process of being acquired by the Coventry Building Society. BBVA has a limited presence in the UK but holds a significant stake in Atom Bank, a digital-only lender.

This is not the first time BBVA and Sabadell have discussed a potential merger. Talks between the two banks took place in 2020 but fell through due to a disagreement over price.

When approached for comment, a spokesperson for BBVA declined to provide any information. However, a Sabadell spokeswoman denied that the bank was in talks with its larger rival or that it had hired advisers in relation to a potential combination with BBVA.

The potential takeover of Sabadell by BBVA would significantly impact the banking landscape in both Spain and the UK. The story continues to develop, and more updates are expected in the coming weeks.

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