Spain's Abanca drops takeover bid for Liberbank

Feb 26 (Reuters) - Spanish lender Abanca scrapped plans to launch a takeover bid for rival Liberbank on Tuesday, saying it had been unable to carry out due diligence before taking a final decision on whether to make an offer.

Shares in Liberbank tumbled 13 percent initially on news that the bid was off and were down 10 percent by 0918 GMT.

Abanca had wanted to analyse Liberbank’s balance sheet prior to the launch of any bid, something the regulator said was not possible under Spain’s stock market rules. On Monday Spain’s CNMV gave the Galician bank 10 working days to decide whether to launch or drop the bid.

Abanca, which is owned by Venezuelan businessman Juan Carlos Escotet through his holding company, said on Friday that it had approached Liberbank about a possible takeover offer, which would value the former savings bank at around 1.7 billion euros ($1.9 billion).

A merger between the two lenders would create Spain’s sixth-biggest bank with around 90 billion euros in assets.

Liberbank is currently involved in a merger process with Unicaja. (Reporting by Joanna Jonczyk-Gwizdala, Editing by Jose Elias Rodriguez and Susan Fenton)