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TSB receives £1.7b takeover approach from Spain’s 5-biggest bank Sabadell

TSB receives £1.7b takeover approach from Spain’s 5-biggest bank Sabadell

AMSTERDAM: TSB has received a £1.7 billion takeover approach from one of Spain’s biggest banks which could boost its efforts to compete with high-street rivals.

Shares in the FTSE 250 challenger bank soared 62p to 326p after it signalled support for a proposed 340p-a-share cash offer from Sabadell, Spain’s fifth-biggest bank.

Lloyds Banking Group – which spun off TSB last year to comply with European rules on state aid it received during the financial crisis but still has a 50 per cent stake – said it would be “minded to accept” an offer at this price if it is made.

Lloyds sold its Spanish business to Sabadell two years ago in exchange for a 1.8 per cent stake in the Spanish bank.

Floating TSB and selling its remaining stake to Sabadell would net Lloyds £1.5billion.

This is double the £750million it would have received for the 632 branches from original suitor the Co-op before that deal fell through.

The price would provide a quick profit for the 60,000 ordinary retail investors who took part in TSB’s 260p-a-share flotation last June.