(Bloomberg) -- Brookfield Asset Management is awaiting information from Grifols SA about related-party transactions as it seeks to complete its due diligence on the business, according to a person familiar with the matter.
That’s a key item among several pending issues that have slowed Brookfield’s process of assessing the value of Grifols ahead of a potential takeover bid, the person said, asking not to be identified discussing private information. The New York-based asset manager is still pursuing a deal and is confident it has a path to fund a transaction, the person said.
Brookfield said in July that it was interested in taking the Spanish drugmaker private along with its founding family, which owns more than a third of the firm. It has already requested more time for the due diligence, Bloomberg News reported in September.
Grifols is due to report its third-quarter results on Nov. 7. Representatives for Brookfield and Grifols declined to comment.
Transactions between Grifols and Scranton Enterprises BV, its second largest shareholder, were at the heart of accusations made against the Barcelona-based company by short seller Gotham City Research in January. The allegations centered on the sale of two businesses to Scranton — a vehicle controlled by former executives, some Grifols family members and Tomas Daga, a long-time board member. Though Scranton owns the two businesses, Grifols consolidated their profits in its own accounts, saying it had control over them.
Grifols has denied wrongdoing and is suing Gotham in a New York court.
In the aftermath of the short seller report, which wiped more than $3 billion off Grifols’s market value, then-Chief Executive Officer and Chairman Thomas Glanzmann pledged to abandon any deals with related parties.
The short seller accusations heightened scrutiny on Grifols’ accounting, and the company said in July that it had overstated the value of its stake in Shanghai RAAS Blood Products Co., confirming an earlier report by Bloomberg News. The company also said it had restated figures relating to its joint venture with ImmunoTek, which resulted in reductions of net income for 2022, 2023 and the first half of 2024.
Since January, Grifols has removed all family members from executive positions and hired outsiders to serve as chief executive officer and chief financial officer. In September, the firm also removed chairman Glanzmann’s executive powers in a move to separate board functions from daily management.
The potential Brookfield bid, after months of a stock rout, has led some shareholders to take steps to defend their interests in the event of a low offer. Three investors holding a total of 7.7% of Grifols’ capital have said they would request a seat on the board. Separately, other shareholders have hired law firm Araoz & Rueda to represent them during the takeover process.
Brookfield has approached several investment funds to join its bid to acquire the blood-plasma company, including sovereign wealth funds ADQ and GIC Pte, Bloomberg News reported in August.
Mark Carney, chair of Brookfield Asset Management, is also chair of Bloomberg Inc.
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