European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>Rejected Offer: Grifols' independent committee rejected Brookfield's proposed valuation of €10.50 per Class A share €7.62 per Class B share, citing significant undervaluation of the company's long-term prospects.</li>
<li>Stakeholder Dynamics: Brookfield seeks a statutory amendment to differentiate Class A and B share prices, while opposition from Brandes (13.5% of Class B shares) and Mason complicates negotiations.</li>
<li>Financial Recovery: Grifols achieved 12% revenue growth in Q3 2024, reduced net debt to €8.1 billion, and targets a 4.5x leverage ratio by year-end, supporting improved financial stability.</li>
</ul>


Rejected Offer: Grifols' independent committee rejected Brookfield's proposed valuation of €10.50 per Class A share €7.62 per Class B share, citing significant undervaluation of the company's long-term prospects.
Stakeholder Dynamics: Brookfield seeks a statutory amendment to differentiate Class A and B share prices, while opposition from Brandes (13.5% of Class B shares) and Mason complicates negotiations.
Financial Recovery: Grifols achieved 12% revenue growth in Q3 2024, reduced net debt to €8.1 billion, and targets a 4.5x leverage ratio by year-end, supporting improved financial stability.


Lowball Non-Binding Indication from Brookfield

<ul>
<li>Since mid-October, share-price spreads have generally tightened across European liquid universe of ordinary and preferred shares (10 have tightened, 9 widened). Most spreads that were already tightening, kept doing so.</li>
<li>Most spreads that were already tightening, kept doing so. Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe.</li>
<li>Recommended trades long ordinary / short preferred shares: Carlsberg, Henkel, SSAB Svenska Stal.</li>
</ul>


Since mid-October, share-price spreads have generally tightened across European liquid universe of ordinary and preferred shares (10 have tightened, 9 widened). Most spreads that were already tightening, kept doing so.
Most spreads that were already tightening, kept doing so. Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe.
Recommended trades long ordinary / short preferred shares: Carlsberg, Henkel, SSAB Svenska Stal.


Liquid Universe of European Ordinary and Preferred Shares: November‘24 Report

<ul>
<li>Brookfield’s acquisition bid for Grifols has been delayed for a second time due to funding issues, raising investor concerns.</li>
<li>Grifols trades at an 8.7x forward EBITDA, significantly undervalued compared to competitor CSL's 18.2x multiple. Long term the stock looks cheap, provided it fixes its leverage problem.</li>
<li>The delay has increased skepticism about the bid's success (pricing a 49.8% of deal success at a possible offer of €11/share), affecting Grifols' stock, which recently fell to €10/share.</li>
</ul>


Brookfield’s acquisition bid for Grifols has been delayed for a second time due to funding issues, raising investor concerns.
Grifols trades at an 8.7x forward EBITDA, significantly undervalued compared to competitor CSL's 18.2x multiple. Long term the stock looks cheap, provided it fixes its leverage problem.
The delay has increased skepticism about the bid's success (pricing a 49.8% of deal success at a possible offer of €11/share), affecting Grifols' stock, which recently fell to €10/share.


Brookfield Delays Its Takeover Bid for Grifols for a Second Time

<ul>
<li>Since mid-September, share-price spreads have generally widened across our European liquid universe of ordinary and preferred shares (9 have tightened, 10 widened).</li>
<li>Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe, Volkswagen.</li>
<li>Recommended trades long ordinary / short preferred shares: Carlsberg, Henkel, SSAB Svenska Stal.</li>
</ul>


Since mid-September, share-price spreads have generally widened across our European liquid universe of ordinary and preferred shares (9 have tightened, 10 widened).
Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe, Volkswagen.
Recommended trades long ordinary / short preferred shares: Carlsberg, Henkel, SSAB Svenska Stal.


Liquid Universe of European Ordinary and Preferred Shares: October‘24 Report

External reports (aggregated public sources), Value Investors Club

Value Investors Club (VIC)

External reports (aggregated public sources)

Value Investors Club

Equity Bottom-Up

<ul><li>Grifols A/B Spread Trade involves the spread between Grifols' ordinary A shares and Preference B shares</li><li>Grifols and Brookfield announced an exclusive agreement to evaluate a potential acquisition of the entire company</li><li>A/B shares were issued in 2011 as part of an acquisition, allowing Grifols to expand its presence in the biopharmaceutical sector while maintaining voting power for the Grifols family</li></ul><p><em>This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.</em></p>

Grifols A/B Spread Trade involves the spread between Grifols' ordinary A shares and Preference B sharesGrifols and Brookfield announced an exclusive agreement to evaluate a potential acquisition of the entire companyA/B shares were issued in 2011 as part of an acquisition, allowing Grifols to expand its presence in the biopharmaceutical sector while maintaining voting power for the Grifols familyThis content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

Grifols A/B Spread (GRF.P) - Monday, Jul 8, 2024

Spain

Grifols S.A. develops, manufactures, and markets plasma derivatives, IV Therapy, enteral nutrition, diagnostic systems, and medical materials.

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Grifols (GRFS US)

Lowball Non-Binding Indication from Brookfield

Rejected Offer: Grifols' independent committee rejected Brookfield's proposed valuation of €10.50 per Class A share, citing significant...

Jesus Rodriguez Aguilar

Liquid Universe of European Ordinary and Preferred Shares: November‘24 Report

Since mid-October, share-price spreads have generally tightened across European liquid universe of ordinary and preferred shares (10 have...

Jesus Rodriguez Aguilar

Brookfield Delays Its Takeover Bid for Grifols for a Second Time

Brookfield’s acquisition bid for Grifols has been delayed for a second time due to funding issues, raising investor concerns.

Jesus Rodriguez Aguilar

Liquid Universe of European Ordinary and Preferred Shares: October‘24 Report

Since mid-September, share-price spreads have generally widened across our European liquid universe of ordinary and preferred shares (9 have...

Jesus Rodriguez Aguilar

Grifols A/B Spread (GRF.P) - Monday, Jul 8, 2024

A/B shares were issued in 2011 as part of an acquisition, allowing Grifols to expand its presence in the biopharmaceutical sector while maintaining...

Value Investors Club (VIC)

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52-week Range

Market Cap (USDm)

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