By Tom Fairless
BRUSSELS--European Union regulators said Monday they had
approved Banco de Sabadell SA's GBP1.7 billion ($2.66 billion)
takeover of TSB Banking Group PLC, in a move that allows Lloyds
Banking Group PLC to fulfill a key condition of its EU-sanctioned
restructuring plan.
The European Commission, the bloc's top antitrust authority,
said the deal raised no concerns because of the companies'
"moderate combined market shares and limited overlap on the markets
concerned."
Lloyds, which floated a minority stake in TSB at 260p a share
last June, said in March would sell a 9.99% stake in TSB to
Sabadell and has agreed to accept the offer for its remaining 40%
shareholding.
The U.K. bank spun out TSB as a separate brand after the EU
demanded that it unload more than 600 branches as a condition of
its GBP17 billion bailout by U.K. taxpayers in 2008. It has been
touted by the British government as a "challenger" bank aimed at
breaking the hold of the U.K.'s four largest retail lenders.
In statement, the commission said the "backing of a larger
banking group like Sabadell will enhance TSB's ability to compete
as a challenger bank and stimulate competition in the British
retail banking markets, to the benefit of U.K. consumers."
Sabadell, Spain's fifth-largest lender, has been an active
consolidator during the Spanish banking crisis, buying several
struggling lenders at deep discounts. But it has made few moves
outside its home market. Sabadell has said the acquisition of TSB
will increase its assets outside Spain from 5% to 22% of its
total.
"Lloyds' recent progress, including the sale of its stake in TSB
approved today, shows the effectiveness of EU state aid rules," the
EU's antitrust chief Margrethe Vestager said in a statement.
David Wighton
in London contributed to this article.
Write to Tom Fairless at tom.fairless@wsj.com
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