Grifols board backs IPO for US business

Spanish pharma group Grifols is planning to sell a minority stake in its US business, via an initial public offering, to raise cash for other activities, including the reduction of debt.

The company – which has had a turbulent couple of years punctuated by allegations of manipulating financial information and an aborted takeover by private equity group Brookfield – intends to retain majority ownership control of the US business, and will retain its current listing in Spain.

Barcelona-based Grifols, a major player in plasma-derived therapeutics like immunoglobulins, is in the process of a major strategic pivot in the face of high debt, the short-seller attack, and concerns about governance of the family-owned business.

The new aims are to pay down debt quickly, improve financial transparency, build a separation between company management and ownership, simplify its capital structure, and build a "self-sufficient" plasma business in which each country it serves can rely on a secure, domestic, end-to-end supply of plasma-derived medicines with no need to rely on international supplies.

Following the proposed IPO, Grifols' US biopharma business will have its own board of directors, a dedicated leadership team, and its own corporate governance structure.

The parent company has already made changes to its management, bringing in fresh management, including new chief executive Nacho Abia in 2024, as members of the Grifols family voluntarily surrendered their C-suite positions.

The US IPO is a key part of the self-sufficiency drive in the US, building on initiatives underway in other markets, including Canada and Egypt, and according to Grifols, will make it "the only US player in the sector that does not depend on…plasma, manufacturing or supply from other markets."

That means it operates the entire value chain, from plasma collection to manufacturing, logistics, testing and distribution, ensuring supply continuity and resilience in "a highly complex sector with long cycles and strict regulatory requirements." It employs around 14,000 people in the US, which is the largest world market for immunoglobulin products.

Grifols grew its revenues 7% to more than €7.7 billion last year, reducing the leverage ratio of debt from 4.6 times to 4.2 times equity, down from a high of 8.4 in 2023, and has predicted it will fall to 3.5 times or lower by the end of next year.