HUD Homes Articles | The Spanish bank already had a nearly 25 percent stake in Sovereign, a Philadelphia-based thrift, and will buy the rest with stock valued at about $3.81 for each share of Sovereign, a premium of 3.5 percent to Sovereign’s closing price on Monday.
The deal, which had been rumored earlier in the day, was announced after trading closed Monday. Sovereign’s shares fell 13 cents to $3.68 in the regular trading session but jumped 16 cents in after-hours trading following the announcement.
Like many U.S. banks, Sovereign Bancorp has been pummeled by rising mortgage delinquencies as the housing market tumbles. Its stock has lost nearly two-thirds of its value in the year to date.
The spreading credit crisis has already resulted in consolidation among national banks including Wachovia Corp., which is being bought by Wells Fargo & Co., and analysts say they’ve been expecting mid-size, regional banks to be next. Sovereign had said earlier Monday that it was in advanced discussions with Banco Santander
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