“Not at any price” (Albert Martín)

The 138-year history, the 16,000 jobs and also the status of fourth Catalan company by turnover must have had some weight in the mental gears of Josep Oliu during the afternoon of Thursday. The president of Sabadell had received a last offer from his BBVA counterpart, Carlos Torres, in the negotiations for the purchase of the bank.

Oliu convened his board of directors to study it and give it an answer. But in his head, bringing the question to the binary world of yes or no, an answer was beginning to be drawn. It was the answer that derived from what he had said to Torres the same Thursday: “Not everything is necessarily resolved with mergers or concentrations at any cost.”

The existence of the bank depended on Oliu’s response and the rest of the council, but it was not an obvious answer, much less. It must be borne in mind that Sabadell is in a compromised situation and that the markets were encouraging the merger, as have the regulators and the central government itself. In addition, Oliu, 71, knows – it is a problem that the bank has dragged on for a long time – that it may have taken too long to organize his succession while his second, Jaume Guardiola, is unclear about his continuity at the bank. . To say yes it ended up with a lot of problems.

Turkish betrayal

The first indication that the negotiations were not going well enough came at an event in the sector where both Jaume Guardiola and Onur Genç, the CEO of BBVA, had to speak. Guardiola said he could say nothing. Genç, on the other hand, stated that BBVA had two alternatives, apart from Sabadell. The phrase was received as a low blow to the dome of the bank based in Alicante.

But the main problem was the usual ones of mergers: the price and the distribution of power. All in a few days when BBVA was worth much more on the stock market than the Catalan bank: this Friday, 13 times more. In recent days, the multiplier was around 8.

Sabadell did not agree with the figures that were put on the table. And he reminded BBVA that he has a subsidiary in Turkey that could bring him problems and that he is also immersed in the investigation of the Villarejo case, the former police commissioner who was spying on the bank at the time of Francisco González.

Yes, a concession was made with the charges: Oliu was offered the non-executive vice presidency. But what was an attempt to move forward ended up being a huge hurdle. Because on Torres weighs the threat of ending up imputed in the same case Villarejo, which would leave the vice president -Oliu- on the throne. The negotiation was beginning to go awry and yet another element appeared: from the Catalan bank BBVA is responsible for the constant leaks to the media that appeared during the negotiation.

The complex discussions between the two sides had different levels: the presidents negotiated the price. Details were provided by its CEOs. And as the days went by, BBVA’s strong position – which did not commit itself to making concessions regarding the continuity of Sabadell’s central services or to maintaining the management model – began to spread a thought shared by different bank executives: “ I hope this doesn’t work out. “

While the presidents played their game without progress, BBVA’s executives remained optimistic and even made maps of what the commercial network would look like once the Catalan bank was absorbed. Everyone takes it for granted that they will give in: “If they go alone, they will be diminished,” they reason. From BBVA’s point of view, Oliu was inflexible in his price claims: he refused to accept an exchange of a BBVA share for a new one from Sabadell (which valued the Catalan bank at around 2.25 billion) and insisted on asking a change 1 to 8 (about 2.5 billion), he explained The confidential.

The break

Everything goes awry when BBVA introduces a new variable in the talks: instead of offering a share exchange, it opens the door to pay in cash by the Catalan bank. This has two consequences: on the one hand, Sabadell’s shareholders, already severely punished, will be left without the consolation of having shares in a large entity. But the second, harder, is that if BBVA pays there is no negotiation worthwhile. The absorption will be much more forceful than expected – and the forecast was already tough.

Thursday Oliu arrives at the council around 9pm but already has an answer in his head. The one he has repeated in recent days to Carlos Torres: “You want me to hand over the bank for a vice presidency.” The council is second and Sabadell says no. In the early hours of the next day it is made public. Sabadell will face the crossing of the desert of the low types alone.


1. Why does the operation sink?

In all negotiations there are distant starting points, but in this case there was no progress. BBVA understood that Sabadell had no choice but to accept what it proposed, while the Catalan bank demanded a better price and more transfers on issues such as the distribution of power or the preservation of central services.

2. What was the weather like during the negotiation?

Financial sources explained from the beginning that “the bride and groom were not very happy at the altar.” Very graphic was Onur Genç, CEO of BBVA, when in the middle of negotiations he announced in a conference that his bank was studying two more options, apart from that of Sabadell.

3. What role did the Villarejo case play?

There is a possibility that Carlos Torres, the current president of BBVA, will be charged in the case with espionage by the ex-police. If that happened, it could open the door for the vice president – a position offered to Oliu – to become president. And BBVA wanted to avoid this scenario.

4. What is the trigger?

BBVA set a scenario: pay the transaction in cash. This ended the negotiation, tightened the conditions for the Catalan side and punished the shareholders.


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