Who’s who at Grifols, the pharmaceutical company that served as the bank for the Catalan family?

In Grifols’ Who’s Who game, the tangle of connections between the family, its company and the Scranton investment firm of which they are a part complicates analysts’ work (see Thursday’s bump up (35% in the stock market after the results are presented) and gives wings to the speculation of bears such as Gotham City. The market is awaiting the verdict of the National Securities Market Commission (CNMV), which is interpreted as the final blow to the company if it turns out to be unprofitable. But in the meantime, the problem that Daniel Yu’s signature on his reports brought to the table remains unresolved: the ties that unite the entire family network. Who’s inside? From holding company Scranton – which is not officially owned by the Grifols, but where directors with that surname directly control 20% – related companies that were sold to Scranton, BPC Plasma and Chaema, bank loans on which the family’s debts are mixed, the company or those granted to the family company; in addition to the money that Grifols lends to the family directly, and even the donations that holding company carried out by non-governmental organizations such as Probitas or the Grifols Foundation itself.

The 2023 results showed that Last year, Grifols lent former president Victor Grifols Roura €5.6 million., who left his post in December. The company only clarifies that this debt was paid off in January, which coincided with the Gotham City report, which was published on the 8th of the same month. No loans have been issued to any other Grifols in recent years, or to any other member of the board of directors.

On the other side, Grifols also lent money to Scranton.after selling BPC Plasma and Haema for $538 million immediately after its acquisition in 2018. In particular, The debt is $110 million. since in addition to the original 95 million last year, this credit was expanded by another 15 million. In other words, Grifols lent money to its shareholder to buy its own companies because, it argues, the debt “is related to payment for the sale” of those two shares. In any case, it is Grifols who will take over this loan in case of non-payment to the banks.

According to what EL MUNDO published in January, in addition, eight Spanish companies will owe Scranton a debt of 450 million euros. which will be equally distributed among CaixaBank, Banco Santander, BBVA and Banco de Sabadell, as well as Bank of America, BNP, HSBC and Commerzbank. There is another 500 million loan directly to Grifols, which the European Central Bank (ECB) asked for clarification when the scandal broke earlier this year.

Scranton, a constant presence in the Gotham City report, has always been considered an asset of the family, although they claim to directly own only 20% of the capital. He is also a shareholder of Grifols, as he owns 8.6% of the shares. However, although Scranton’s accounts are in Holland, some of its directors are known. One of them is lawyer Thomas Daga, an adviser to a pharmaceutical company who is listed as a shareholder of Scranton Enterprises. He is also one of the founding partners of the law firm Osborne Clarke. The fiefdom has two companies: one specialized in plasma and the other in real estate, Centurión. Among the three top managers, two are related to Grifols or its directors. Jordi Fabregas is also one of the founders of Osborne Clarke; and Juan Javier Roura joined the group in 1986 and was vice president of treasury and risk at Grifols until his departure in 2015.

On the other side, Grifols meets its annual commitment to distribute 0.7% of its pre-tax profits to the non-profit organization., it is not specified whether this is Probitas or the Grifols Foundation itself, or a third party (the company did not answer this question), in both cases a controlled company. The President of the Probitas Board is Nuria Martin Warnes, co-founder of Osborne Clarke and Secretary of the Grifols Board of Directors since 2015. Enrique Grifols Roura, a doctor by profession, is also a member.

Bounce in the bag

Yesterday Grifols recovered just over €800 million in market capitalization with an 18% gain, which did not offset the 35% fall this Thursday after reporting results that were not audited by KPMG. Behind this rise are up to three important facts that the listed company published yesterday before the end of the morning through the National Securities Market Commission (CNMV) to explain what it did not clarify the day before. The first of these was a confirmation of what was said on Thursday that Haier deal to sell 20% of Shanghai Raas remains uncomplicatedsurpassed due diligence, and it will close until the summer. This money is key for Grifols, as the $1.8 billion it receives will be used entirely to pay off debt. Specifically, the 1900 million that he has with two maturities in 2025.

The second important fact was the explanation for the misunderstanding that occurred on Thursday due to the board’s poor English speech when it was implied that cash flows (which were negative in 2023) would be positive by several million next year. years. The firm expects that from 2025 to 2027 they will reach 2000-2500 million euros.. It will be around 5 million due to the impact of some investments (in ImmunoTek) this year.

The third message was to blame the press, which, according to the company, “misinterpreted the accounting treatment” provided to the related companies “Haema, AG and BPC Plasma” and to the payment of 266 million euros in dividends that were paid to Scranton, which is the actual owner of these companies. Note that Grifols has not given press conferences or statements to journalists since the scandal broke on January 8.

“Presumably, the payment of dividends is carried out by providing “Other non-current financial assets”, which can represent any type of financial investment other than cash. This is a movement that has not been explained but may involve financial loss to minority shareholders of Grifols for the same amount“since the counterparty of the obligation can only be its own resources, in our preliminary opinion, based on the confusing and insufficient available information,” note the Bankinter analytical department. On the other side, Grifols has not paid dividends to its shareholders since 2021 due to high debt levels.