Grifols Says Founding Family, Brookfield Weigh Takeover Bid

(Bloomberg) -- Grifols SA said that its founding family and asset manager Brookfield have made an approach to buy and delist it, after the pharmaceutical producer lost billions in market value amid a short-seller attack.
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Brookfield and the Grifols family “have reached an agreement to evaluate a possible joint takeover bid to acquire all” the shares of the company and take it private, the Barcelona-based firm said in a regulatory filing Monday. The company has a market value of €5.5 billion ($6 billion).
Grifols doesn’t know whether the transaction will take place nor the terms under which it would be carried out, it said.
The offer is the latest twist in a crisis that started in January, when the company came under a short-seller attack from Gotham City Research. As Grifols sought to calm investors, it removed all family members from executive positions, hired an outsider as chief executive officer and named a new chief financial officer.
The stock has fallen by 36% since Gotham published its report, where it accused the company of manipulating its debt and profit figures. The plunge wiped some €3.2 billion from its market value.
Grifols has denied any wrongdoing.
Family members and a group of associates control about 30% of Grifols through several vehicles. Three family members and a long-term lawyer to the family sit on the 13-member board. The family ran the company for four generations, until 2023, when an outsider became chief executive officer for the first time.
Grifols’ high-yield bonds surged on the news. Notes due in October 2028 are poised for the largest daily gain since they were issued, according to data compiled by Bloomberg, rising 5.6 cents on the euro at 89.4 cents.
The firm is loaded with debt and has for months sought to reassure investors that it can make enough cash to meet its obligations.
Trading in Grifols shares was suspended before markets opened in Spain on Monday. They had gained 7.9% in pre-market trading.
By acquiring Grifols, Brookfield would add to private equity’s growing interest in blood plasma products in recent years.
In 2022, Permira acquired two companies to combine them. It teamed up with Abu Dhabi Investment Authority to buy Italian family-run drugmaker Kedrion Biopharma, and also purchased the U.K.’s Bio Products Laboratory Ltd.