MADRID – Canadian fund Brookfield (NYSE: BN) has dropped its plan to take over Spain’s Grifols (NASDAQ: GRFS) due to a disagreement over the pharmaceutical company’s value, while Grifols said it concurred with the decision.
Brookfield had filed a non-binding offer on November 19 for Grifols that valued the developer of human plasma-based drugs at 6.45 billion euros ($6.79 billion), which Grifols then said was a significantly undervalued offer and told its shareholders to stick to their shares.
Grifols shares fell 12% to $7.63 following Bloomberg’s initial report about Brookfield’s decision.
“This morning Brookfield informed the Grifols Transaction Committee that in the current circumstances, it is not in a position to continue with a potential offer for Grifols,” the Canadian company said in a statement.
In September, Brookfield (NYSE: BN) said it was interested in launching a takeover bid jointly with the Grifols family, pending the successful completion of due diligence.
Earlier on Wednesday, Grifols (NASDAQ: GRFS) received a letter from Brookfield explaining its position and held an extraordinary board meeting, the Spanish company said in a statement to the Spanish market supervisor.
“The board of directors concurs that, given the current circumstances, it is not feasible for the transaction to move forward,” Grifols said. “The board of directors appreciates the efforts made, although they have not been sufficient, and remains focused on enhancing the company’s long-term value.”
A spokesman for Grifols’ founding family had earlier confirmed Brookfield’s exit.
“Brookfield is withdrawing its offer due to a discrepancy over the price. The company has a much higher value (than what Brookfield offered),” the spokesperson said, adding: “We continue as we were.”
It was unclear whether the family and Brookfield might resume talks later on.
($1 = 0.9505 euro)
