The Shares of CaixaBank and Bankia have Skyrocketed

The shares of the Madrid entity ended on Friday with a rise of 32.9% and the titles of the Catalan, 12.4% after confirming both the negotiations to create the first bank in the country.

The shares of CaixaBank and Bankia have skyrocketed as soon as the trading session began on the Ibex 35 after both entities confirmed late last night that they are in negotiations to carry out a merger that would result in the largest bank in Spain.

Investors had been warning before the market opened, with the pre-opening launched, and the course of the day on the market has confirmed their interest. CaixaBank shares ended the session with a rise of 12.4%, to 2.04 euros, while those of Bankia have gained 32.9%, which has allowed them to stand at 1.37 euros.

The news was confirmed at the stroke of midnight on Thursday, when both companies issued separate statements to the National Securities Market Commission (CNMV) informing them of the negotiations they hold to merge their businesses.

“Given its preliminary nature, it is stated that a proposal to initiate study and analysis has been submitted to Bankia’s governing bodies that allows the Board of Directors to adopt the appropriate well-founded decision, counting on the relevant advisers,” it states the note of the Madrid entity. The Catalan, for its part, detailed that they are in the process of exchanging information “to assess the operation, within a due diligence, with advisers for the operation.”

Bankia’s capitalization is around 3,178 million euros, while that of CaixaBank is around 10,860 million. If the operation is completed, the union would give rise to a group with assets amounting to 650,000 million euros, some 6,600 branches (4,400 the entity of Catalan origin and more than 2,200 the nationalized entity) and a joint workforce of more than 51,000 employees ( almost 35,600 CaixaBank and some 16,000 Bankia), which would promote significant synergies.

According to the plans advanced by El Confidencial, La Caixa Foundation would control 30% of the group resulting from the merger, while the Fund for Orderly Bank Restructuring (FROB), would reduce its weight from almost 62% today to 14%.

The union also seems to have the approval of the Government, which also spoke last night through the Ministry of Economic Affairs. The department led by Nadia Calviño published a statement in which it acknowledges that, with regard to the merger of CaixaBank and Bankia and in the event that the negotiations conclude on a proposed merger agreement, “the FROB will analyze them fully objectivity from the perspective of generating value and optimizing its ability to recover aid “.

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The Shares of CaixaBank and Bankia have Skyrocketed - /10

Summary

The shares of the Madrid entity ended on Friday with a rise of 32.9% and the titles of the Catalan, 12.4% after confirming both the negotiations to create the first bank in the country.

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