Grifols holder Mason Capital opposes potential transaction, tells board

Mason Capital Management, a registered investment advisor to funds and accounts holding approximately 2.1% of Grifols (GRFS) class A shares, sent a letter to the Grifols board, which reads in part: “The rumored Brookfield transaction is the product of improper corporate governance by a conflicted Board with a history of poor capital allocation. While the family and its related directors currently have de facto Board control, it is with only ~31% of the Class A voting shares. The remaining 69% can permanently fix the corporate governance failings at Grifols and unlock tremendous value by doing so. Brookfield is not needed…To directly address the potential Brookfield transaction: Why would shareholders sell at the rumored prices of EUR 12/share and allow the family and Brookfield to take away the upside from positive business momentum and addressing corporate governance concerns? Before the short report, Grifols hadn’t traded lower than 12.0x EBITDA over the past 10 years (as shown in the appendix). Mason Capital is confident that with an independent board and proper corporate governance, Grifols will regain at least its lowest historical market multiple given the asset quality. At 12.0x EBITDA, Grifols is worth EUR 20+ today. Again, why would shareholders sell at EUR 12/share.”