(Bloomberg) -- Banco Bilbao Vizcaya Argentaria SA would be able to add cash to its hostile takeover bid for Banco de Sabadell SA if it sold Sabadell’s UK unit, according to Barclays analysts.

Divesting TSB Banking Group Plc “could allow BBVA to include a cash element of up to 10% of the offer with a limited incremental CET1 impact for BBVA’s shareholders,” analysts led by Cecilia Romero Reyes said in a note on Monday. “In the UK, BBVA with TSB would lack scale to pursue their strategy of growth, which intends to combine scale and profitability, and we think a sale could be well-received.”

BBVA last week made a hostile takeover offer for Sabadell in a move not seen among Spanish banks since the late 1980s. It’s offering one newly-issued BBVA share for every 4.83 Sabadell shares.

When asked on an analyst call last week if he would sell TSB after a Sabadell takeover, BBVA Chief Executive Officer Onur Genc said “it’s too early to tell.”

BBVA previously tried to buy Sabadell in late 2020 but the talks collapsed over pricing. Sabadell subsequently considered selling TSB, Bloomberg reported at the time. 

Read More: Sabadell Said to Weigh Mexico, TSB Sales After BBVA Deal Fails

--With assistance from Michael Msika, James Cone and Macarena Muñoz.

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