Santander to buy UK high street lender TSB for £2.65bn

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Santander agreed to purchase the British TSB on the TSB street for 2.65 billion pounds, in a move confirming the Spanish bank’s commitment to running a retail sale in the United Kingdom after just months of entertainment for bidding for the company.

Santander defeated his British rival Barclays, who also made an official offer to the SABADELL owned unit, according to people familiar with the matter.

The deal comes at a time when the SABADell, which bought TSB in 2015 for 1.7 billion pounds, is seeking to hunt a hostile approach of 11 billion euros from its local opponent BBVA.

Sabadell launched the bidding process for TSB after receiving an unwanted interest to the company, and the Financial Times revealed last month.

Industry observers have seen this step as a deterrent to acquire BBVA, which launched its hostile offer for SABADIL last May, which has come since then to the worse serenity in Spain for years.

Santander’s successful offer for TSB will enhance UK market share for the Spanish lender and comes after a period of uncertainty about its future in Britain, where the bank has reduced thousands of jobs. The president of the United Kingdom announced his departure earlier this year after disputes with the leadership of the group.

Over the past year, Santander enjoyed offers from both NatWest and Barclays for its retail arm in the United Kingdom, but eventually rejected offers due to differences on price, FT previously said.

Spanish executive officials at the bank have been frustrated by its weakest returns in its work in the United Kingdom for its other markets, as well as the high cost base of the unit.

“We did not want to sell the UK’s business, but we have offers,” said a person familiar with the matter. “This is the best result and will allow Santander to address UK issues … and accelerate growth.”

Santander earlier this year sold a large part of its Polish operations to the Austrian Bank group for about 7 billion euros, and promised to use half of the money to buy its own shares.

BBVA was never clear about its Sabadell plans, but it is widely expected to put it on the market if it succeeds in buying its Spanish opponent. However, he faced a great spread from the Spanish government, which said last week that it would prohibit a legal integration between banks for at least three years.

With the presence of Sabadell currently the subject of the acquisition offer, its board of directors is obligated to “the negative duty”, which means that the agreed treatment will be provided to investors to approve it at an extraordinary meeting for public shareholders.

“This deal is useful to the bank and its shareholders, because it creates a great value, allowing us to pay unusual profits,” said President Josep Oliu.

Santander said the mix “will provide a great value for shareholders in Santander by increasing … and increasing access to low -risk real estate mortgages, high -quality deposits, and operational competencies.”

“The transaction will accelerate our way to a greater profit in the United Kingdom and help achieve a 16 percent revenue from concrete shares by 2028,” the bank’s CEO added. Unity had a return on concrete property rights – a scale of profitability – by 11 percent in 2024.

TSB reported the pre -tax profits last 285 million pounds at an income of 1.14 billion pounds, and the total assets of 46.1 billion pounds at the end of 2024 were about 5 million customers in the United Kingdom.