Sabadell rejects Co-op’s £1bn approach for TSB
TSB will remain part of Sabadell
Another attempt to consolidate Britain’s banking sector has been thwarted after Spain’s Sabadell rejected a £1 billion offer for its TSB subsidiary from Co-operative Bank.
Sabadell confirmed in a statement on Saturday that it had received a letter from Co-operative Bank outlining its terms.
The Spanish bank’s board rejected the approach, first reported by Sky News, saying “this is not a transaction that we wish to explore at this moment as we have previously expressed publicly”.
It is understood the correspondence was exchanged at the end of September.
TSB was demerged from Lloyds Banking Group in 2013 and enjoyed a short return to being an independently-listed bank until Sabadell acquired it for £1.7bn two years later.
Problems with its IT prompted a review of its role in the group.
At the end of last year it hired Goldman Sachs to advise on a sale and there was speculation that Virgin Money or OSB, formerly One Savings Bank, would be among the bidders.
But Sabadell’s new chief executive Cesar Gonzalez-Bueno reversed the process and is working on turning the bank around.
A merger between Coop bank and TSB would create a high street lender with more than eight million customers.