Grifols family in talks with Brookfield over move to take healthcare group private

The family behind Grifols, the €6bn Spanish healthcare group rocked by fraud allegations earlier this year, is exploring a bid to take the company private with Canada’s Brookfield.

Spain’s market regulator suspended Grifols shares on Monday as the company said it had received a request from the Grifols family and Brookfield for access to its books “to carry out due diligence in relation to a possible acquisition”.

Shares in Madrid-listed Grifols plunged in January when Gotham City Research, a UK-based short seller, accused the medicine manufacturer of artificially manipulating its debt and earnings through transactions with a company related to the Grifols family.

Barcelona-based Grifols has denied wrongdoing, describing the allegations as “false information and speculations”.

The allegations wiped billions off Grifols’ market value and its shares remain 37 per cent below where they were trading before Gotham City published its report. Grifols also has a listing on the Nasdaq.

Brookfield said in a statement that it had held “exploratory talks” with certain Grifols shareholders over a potential joint offer for the company.

Grifols has failed to quell investor doubts since Gotham’s move, even though it has removed members of the founding family from executive roles and appointed a new chief executive, Nacho Abia, who joined from Olympus.

Referring to the possible acquisition, Grifols said “it does not know whether or not such a transaction will take place and is completely unaware of the terms and conditions under which such a transaction would take place”.

Grifols, which traces its origins to 1909, makes medicines derived from blood plasma and has a large presence in the US. The US has become Grifols’ most important market, accounting for three-fifths of sales and is home to roughly two-thirds of its 26,000 employees. 

The attack on the company was controversial in Spain, where critiques from short sellers have been rare.

Gotham City’s allegations centred on the sale of two businesses to Scranton Enterprises, a family vehicle. Gotham City said Grifols continued to report profits from the units, BPC Plasma and Haema, within its consolidated accounts, calling the accounting treatment “materially deceptive and incorrect”.