(Bloomberg) -- Spanish drugmaker Grifols SA is being sanctioned by the country’s markets regulator for “misleading reporting,” a blow for the pharmaceutical company as it deals with a takeover approach.
CNMV announced the sanction after investigating Grifols’ accounts and finding “relevant deficiencies,” though “no significant errors.” It said the company, targeted by a short-seller attack earlier this year, supplied inaccurate data and its financial reports over the past several years contained misleading information about the way it calculates certain metrics.
In response, Grifols said the penalty did not exceed €1 million ($1.1 million). Grifols said the sanctions would have no impact on its financial statements.
The regulator also opened disciplinary proceedings against Gotham City Research LLC and General Industrial Partners LLP, who orchestrated the short-seller attack back in January. It said they manipulated the market through the report and by not properly disclosing their interests.
CNMV reviewed Grifols’ reporting in March after the short-seller report and slump in the company’s market value. The Barcelona-based firm ousted members of the founding family from management and appointed outsiders to the roles of chief executive officer and chief financial officer. Last week, Grifols accelerated a plan to separate board and management responsibilities by cutting Chairman Thomas Glanzmann’s executive powers.
Investors are currently waiting for Brookfield Asset Management and the Grifols family, which controls a third of the company, to make a bid to take the drugmaker private. The talks were disclosed in July and no further details have been officially confirmed.
Shareholders have been taking steps to defend their interests in case the offer is deemed too low. Three Grifols investors are grouping their shares to demand a seat on the board. Another group has hired law firm Araoz & Rueda to represent them during the takeover process.
Brookfield has been in talks with several sovereign wealth funds, including Abu Dhabi’s ADQ and Singapore’s GIC Pte., to partner on the takeover of Grifols, Bloomberg reported in August. Any proposal by the Toronto-based asset manager and the Grifols family could give the company an equity value of around €8 billion ($8.9 billion).
Mark Carney, chair of Brookfield Asset Management, is also chair of Bloomberg Inc.
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