Spanish lender Unicaja denies report it has held merger talks with Sabadell

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MADRID/BANGALORE (Reuters) -Spanish lender Unicaja denied on Monday that it held talks about a merger with Banco Sabadell after Bloomberg News reported the lenders held informal discussions for it.

The report also said Sabadell's executives had sounded out some key shareholders of Unicaja earlier this month about a potential deal as it sought to fend off a hostile takeover by larger rival BBVA SA.

A Unicaja's spokesperson, who denied merger talks between both banks, said it was not aware of any informal talks with the lender's shareholders.

Unicaja's largest shareholder is the foundation of Unicaja with a 31.2% stake. The foundation of Unicaja was not immediately available for a comment.

Earlier on Monday, another Spanish lender Abanca had also denied a report in the Expansion newspaper that said Sabadell was exploring a possible merger with it.

Sabadell declined to comment.

Sabadell and the Spanish government have opposed the hostile takeover by BBVA due to concerns it could reduce competition and lead to job losses.

The government launched a non-binding public consultation on the matter last week and Economy Minister Carlos Cuerpo said that the process will conclude on May 16.

Last month, Spain's competition watchdog approved the takeover bid subject to several remedies.

($1 = 0.9017 euros)

(Reporting by Jesus Aguado in Madrid and Gnaneshwar Rajan in Bengaluru; Editing by Leroy Leo)