Spain's Santander to absorb Banesto

Spanish bank Santander said this morning it is to absorb its 90 per cent owned subsidiary Banesto through a merger.

Banco Santander currently holds 89.74 per cent of Banesto’s share capital.

Banesto shareholders will receive Santander shares at a premium of 24.9 per cent.

Trading in both banks’ shares was suspended this morning.

The transaction is part of the restructuring of the Spanish financial system, and will strengthen the Santander brand.

The merger is due to complete in May next year.