Grifols
Note: This is a daily stock update and the information stands true as of 30/08/24, 09:00 CEST.
Company Update:
According to Bloomberg, Brookfield asset management is in talks with other investment funds, including sovereign wealth funds of Abu Dhabi (ADQ) and Singapore (GIC), to join hands in acquiring Grifols. Note that Grifols family and Brookfield, last month announced their intention to take the Spanish blood plasma giant private, and Brookfield has also requested banks to refinance Grifols’ existing debt. A formal offer is yet to be made.
The article mentions a potential bid at €8bn (for equity) ie 35% premium to last share price. Considering the recent turmoil (stock down 36% ytd) we believe shareholders may request a more substantial premium to tender their shares.
Expert Opinion:
Still a long in my opinion. Even on a stand alone case (which seems increasingly less likely) the company is worth more than its current share price. We believe the operations remain well oriented while the deleveraging will occur and there will be no need of a capital increase. If we are right (on the absence of capital increase) the valuation should be much higher. Stock trades on a PE of 13.2 for 2024 down to 7.3x in 26. Growth prospects remain strong.
For daily updates, subscribe to our newsletter and for detailed daily updates, reach our to us at sales@alphavalue.eu
Company Update:
According to Bloomberg, Brookfield asset management is in talks with other investment funds, including sovereign wealth funds of Abu Dhabi (ADQ) and Singapore (GIC), to join hands in acquiring Grifols. Note that Grifols family and Brookfield, last month announced their intention to take the Spanish blood plasma giant private, and Brookfield has also requested banks to refinance Grifols’ existing debt. A formal offer is yet to be made.
The article mentions a potential bid at €8bn (for equity) ie 35% premium to last share price. Considering the recent turmoil (stock down 36% ytd) we believe shareholders may request a more substantial premium to tender their shares.
Expert Opinion:
Still a long in my opinion. Even on a stand alone case (which seems increasingly less likely) the company is worth more than its current share price. We believe the operations remain well oriented while the deleveraging will occur and there will be no need of a capital increase. If we are right (on the absence of capital increase) the valuation should be much higher. Stock trades on a PE of 13.2 for 2024 down to 7.3x in 26. Growth prospects remain strong.
For daily updates, subscribe to our newsletter and for detailed daily updates, reach our to us at sales@alphavalue.eu
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Alphavalue Morning Market Tip
Weak Q2 results and FY guidance (marginally) cut but a fat 9.4 % div yield.
