Advising Banco Sabadell on the proposed £2.65bn sale of TSB to Santander

We advised Banco Sabadell on the proposed sale of TSB Banking Group to Banco Santander for an initial price of £2.65bn. The transaction will unlock significant shareholder value, enable a €2.5bn extraordinary dividend and support Sabadell’s renewed strategic focus on its core Spanish market.

The challenge

Banco Sabadell acquired TSB in 2015 with the aim of building a UK retail banking presence. A decade later, with TSB having substantially improved its financial performance, Sabadell identified a strategic opportunity to realise value from the investment and refocus on its Spanish core operations.

The transaction took place in the context of wider market dynamics, including a live hostile takeover bid for Sabadell by BBVA. Ensuring the deal delivered clear standalone value for Sabadell’s shareholders, regardless of the bid outcome, was essential.

Our approach

We led on all UK legal aspects of the transaction, advising across corporate, financial services, tax, reward, employment and competition matters.

Our cross-practice team:

• structured the sale to include the transfer of £1.45bn in TSB debt instruments, comprising senior unsecured, subordinated and convertible securities;
• advised on regulatory approval pathways and transaction timing to align with market disclosure and shareholder approval requirements;
• ensured the deal would support Sabadell’s capital position and enable the proposed €2.5bn extraordinary dividend – a key aspect of shareholder return planning; and
• successfully completed the transaction in an accelerated timescale. 

We worked closely with Sabadell’s Spanish counsel, Uría Menéndez, to deliver this significant cross-border financial services transaction.

The outcome

The transaction, announced in July 2025, is expected to complete in early 2026 (subject to shareholder approval of the sale and regulatory approvals). It values TSB at around 1.5x book value. Following the deal, Banco Sabadell will keep its UK corporate and investment banking presence but exit retail banking, supporting its long-term strategic focus on its core Spanish market. It is a striking example of our work advising on major international transactions that involve UK-regulated entities and global financial institutions.