Spanish pharmaceutical company Grifols (GRLS.MC) has rebuffed a potential takeover bid from Canadian investment firm Brookfield, arguing that the €6.45bn ($6.8bn) proposal significantly undervalues the company’s growth prospects and long-term potential, according to a report by Reuters.
Grifols, a specialist in plasma-derived medicines, urged its shareholders to hold onto their stakes, stating the offer does not align with the company’s intrinsic value or strategic outlook.
Earlier this week, Brookfield disclosed its interest in acquiring Grifols with a non-binding offer of €10.50 per A share and €7.62 per B share, valuing the company at €6.45bn and filed the offer with the Spanish stock market regulator.
Brookfield had previously expressed its intention to collaborate with the Grifols family to privatise the company, aiming to revamp its operations outside the public market.
Following a board meeting on Tuesday, Grifols officially stated it would not recommend shareholders accept the proposed bid. The company reiterated its confidence in its financial position and growth trajectory.
“Grifols firmly believes that the potential offer does not reflect the true value of the company or its long-term potential,” the board said in a post-market statement.
Grifols’ shares fell more than 5% to €10.34 on Tuesday, recovering slightly after steeper intraday losses. The stock has seen significant pressure in 2023, with its market value declining by approximately 30% since January.
This decline was exacerbated by allegations from short-seller Gotham City Research, which accused Grifols of overstating earnings and understating debt. Grifols has strongly denied the claims.
Adding to the controversy, Spain’s High Court announced on Tuesday that an investigating magistrate had opened a probe into Gotham City Research. The court cited sufficient evidence to warrant an investigation into potential violations of market and consumer protection laws by the short-seller.
