European Event-Driven Analyst

Jesus Rodriguez Aguilar

Jesús is an Insight Provider (Event-driven) on the Smartkarma network, where he looks across sectors at opportunities arising from securities mispricing (both credit and equity), share classes, bid announcements, prospective bids, and special situations. He has served as Economic and Business Advisor at the Spanish Congress in Madrid. Prior to that, he has worked in the City of London: as a Credit Analyst at Bloomberg; Event-driven associate at former boutique European Research; and doubled as Special Situations and Equity-linked VP (convertible bonds) at Merrill Lynch. Jesús has an MBA from the London Business School, a BA (Hons.) degree in Economics from the Complutense University in Madrid, and a BA (Hons.) in Law from U.N.E.D., also in Madrid.

Liberbank (LBK SM) - Unicaja (UNI SM) Second Time Around

Event-Driven

<p><a href="https://www.smartkarma.com/entities/unicaja-banco-sa" target="_blank" data-smartkarma-citation="entities:28379:1" rel="noopener">Unicaja Banco SA (UNI SM)</a> and <a href="https://www.smartkarma.com/entities/liberbank-sa" target="_blank" data-smartkarma-citation="entities:21279:1" rel="noopener">Liberbank SA (LBK SM)</a> will soon finalize their merger after receiving all the authorisations. On 19 July, the Spanish Government gave the green-light to the integration, which is expected to close on 30 July.</p>
<div>
<p>Unicaja, as the purchasing entity, plans to issue around 1,075 million new shares to meet the agreed exchange ratio (2.7705 LBK SM x 1 UNI SM). Unicaja will have a holding of 59.5% in the new bank, while the remaining 40.5% will be distributed among Liberbank shareholders.</p>
<div>
<p>Unicaja will become the fifth largest domestic bank, with assets totaling c. €110 bn, 9,000 employees and 1,554 branches (of which 300 will be closed). Unicaja will record a "badwill" of €2,015 mn in the merger with Liberbank (which trades well below its BV), and will use it to cover the cost of reducing the workforce.</p>
<p>Liberbank's shares are trading at a <strong>0.8% discount</strong> (adjusted for the merger ratio).</p>
<ul>
<li>The all-share merger will see Unicaja absorb Liberbank at an exchange ratio of 2.7705 Liberbank shares for 1 Unicaja share.</li>
</ul>
</div>
<p>Although liquidity is thin, <strong>recommendation</strong> is <strong>short UNI SM/long LBK SM</strong>. Effective merger is highly likely to happen on 30 July.</p>
</div>

Unicaja Banco SA (UNI SM) and Liberbank SA (LBK SM) will soon finalize their merger after receiving all the authorisations. On 19 July, the Spanish Government gave the green-light to the integration, which is expected to close on 30 July.

Unicaja, as the purchasing entity, plans to issue around 1,075 million new shares to meet the agreed exchange ratio (2.7705 LBK SM x 1 UNI SM). Unicaja will have a holding of 59.5% in the new bank, while the remaining 40.5% will be distributed among Liberbank shareholders.

Unicaja will become the fifth largest domestic bank, with assets totaling c. €110 bn, 9,000 employees and 1,554 branches (of which 300 will be closed). Unicaja will record a "badwill" of €2,015 mn in the merger with Liberbank (which trades well below its BV), and will use it to cover the cost of reducing the workforce.
Liberbank's shares are trading at a 0.8% discount (adjusted for the merger ratio).

The all-share merger will see Unicaja absorb Liberbank at an exchange ratio of 2.7705 Liberbank shares for 1 Unicaja share.


Although liquidity is thin, recommendation is short UNI SM/long LBK SM. Effective merger is highly likely to happen on 30 July.


Liberbank SA

Unicaja/Liberbank: Final Stretch