Spanish banking giant Banco Bilbao Vizcaya Argentaria (BBVA) has officially submitted a hostile takeover bid for its smaller rival Sabadell, valuing the competitor at €14.8 billion.

If the deal goes through and enough shareholders tender their shares, the combined bank would have total assets exceeding €1 trillion  and employ more than 140,000 people worldwide. Behind market leader Caixabank, BBVA would become the second-largest bank in Spain.

By market capitalization, BBVA is already Spain's second-larges bank after Santander. Sabadell ranks fourth among Spanish banks by market value.

Offer Period Until Early October

The offer, approved by the Spanish stock market regulator, proposes one newly issued BBVA share for every 5.5483 Sabadell shares, plus 0.70 Euros in cash. Based on Friday's closing prices, the bid amounts to approximately 14.76 billion Euros.

Sabadell's board has ten business days to issue its formal opinion on the bid.

Shareholders have until October 7 to tender their shares, with results expected on October 14. BBVA aims to secure a majority of voting rights, equivalent to 49.3 percent of Sabadell's shares.

Government Merger Restrictions

The takeover battle, launched with an initial offer in April 2024, has dragged on for months. The deal promises cost savings of about 900 million Euros, but government conditions mean the benefits will take years to materialize. Under the terms, the banks must remain operationally independent for at least three years, with no layoffs of branch closures allowed during that period.

Market observers anticipate that BBVA may raise its bid, an expectation reflected in Sabadell's share price.