BBVA gets approval to take over Sabadell’s Mexican businesses

By Jesús Aguado

MADRID (Reuters) -BBVA said on Monday that Mexico’s competition authority had given its approval for the Spanish bank to take indirect control of Sabadell’s Mexican businesses.

BBVA (BME:) had already secured clearance from the European Central Bank and authorities in several countries where its smaller Spanish bid target Sabadell has a presence, including Britain, the United States, France, Portugal and Morocco.

Spain’s second-largest bank makes around half of its overall profit in Mexico, where it said the competition authority concluded that the deal “would have low probability of impacting the competition process and free economic activity”.

Combining the two lenders would create a bank with more than 1 trillion euros ($1.04 trillion) in total assets and mark the latest consolidation move in Spain’s banking industry.

BBVA is working on concessions after Spain’s competition watchdog said that its Sabadell bid, initially valued at 12.28 billion euros ($13 billion), must undergo a longer review.

Shares in BBVA have fallen around 15% since it announced its offer on April 29, now valuing it at around 10.25 billion euros.

The acquisition, which the Spanish government opposes, also requires authorisation from Spain’s stock market supervisor.

Sabadell rejected the all-share offer in May, prompting BBVA to go hostile in a second attempt to buy the country’s fourth-largest lender, after a failed 2020 bid.

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