Co-op Bank surprised investors at the weekend with an unsolicited offer for TSB.
According to Sky News, the Co-operative Bank contacted TSB’s Spanish owner, Banco Sabadell, earlier in October to gauge whether it was open to a possible merger.
Co-op Bank was understood to have offered over £1.0bn for TSB.
In response, Banco Sabadell issued a statement saying that “as we have stated in the past, this is not a transaction that we are interested in exploring at this time.”
A tie-up between the Co-op and TSB would create a lender with more than 8.0 customers, putting it ahead of Virgin Money, which has roughly 6.5m.
News of the unsolicited approach was likely to arouse interest in TSB from other suitors, Sky said.
Co-op itself had been in talks about a potential sale with Cerberus Capital Management before talks broke down in December.
As of 0839 BST, shares of Banco Sabadell were topping the leaderboard on the Ibex 35 with a gain of 3.98% to €0.68.
