'Significant shortcomings' in Grifols financial reports, says regulator

CNMV believes Catalan company's debt is reflected correctly despite deficiencies

Grifols headquarters in Sant Cugat del Vallès
Grifols headquarters in Sant Cugat del Vallès / Albert Hernàndez

ACN | @agenciaacn | Barcelona

March 21, 2024 08:35 PM

March 22, 2024 03:15 PM

Spain's National Securities Market Commission (CNMV) has found “significant shortcomings” in Grífols’ financial report but believes that the company’s debt is reflected correctly. 

Nevertheless, the deficiencies in information are significant, because “they have hindered investors' ability to adequately understand" Grifols' "financial situation, results and cash flow."

Grifols filed the report in January in response to Gotham City Research's accusations that the pharmaceutical company manipulated its accounts to hide debt.   

In January, the markets regulator outlined its "firm determination to clarify the situation as soon as possible."  

The CNMV also said that it was "analyzing Gotham's conduct regarding the content of its report, how it was disseminated, and related market operations."

Gotham's accusations and Grifols' response 

Catalan multinational Grifols saw its stock market price plummet on January 9 following a report that accused the company of manipulating its accounts. 

The company's price dropped by as much as 40% during the course of that morning, after it initially appeared on the index without a price. 

The report, created by Gotham City Research investment fund, said that the company's shares were worth "zero." 

Grifols' CEO denied the fraud allegations and made commitments to improve company governance. Thomas Glanzmann said the claims in the short seller's report were "false." 

Grifols announced it would take legal action against the hedge fund for the "significant damage caused" to the pharmaceutical company's finances and reputation.