Mason Capital Demands Transparency from Grifols

Mason Capital Management, a registered investment advisor with a 2.5% stake in Grifols S.A., has sent a letter to the Spanish National Securities Market Commission (CNMV) highlighting severe lack of disclosure on key issues by the current Board of Directors. The letter, dated January 13, 2025, urges the CNMV to consider the benefits to all Grifols shareholders from improved disclosure around several key issues.

Mason Capital's concerns revolve around three main areas:

1. Related-Party Transactions and Conflicts of Interest at the Board Level: Mason has raised concerns about numerous related-party transactions and potential conflicts of interest involving Board member Tomas Daga and his firm Osborne Clarke Spain, which has been the primary advisor on Grifols transactions since 2014. Mason requests detailed disclosure of fees paid to Osborne Clarke Spain, Daga's ownership stakes, and the bond indenture terms to evaluate the governance issues and their impact on shareholder value.
2. Questions about Grifols' Internal Legal Department Structure: Mason notes that Grifols has only 14 employees in its internal legal department, all located in the US, rather than at headquarters in Barcelona. This raises concerns about the adequacy of the internal legal department's size and location for a company of Grifols' size and complexity.
3. Concerns about a December 2024 €1.3bn Bond Issuance with a 7.125% Interest Rate: Mason alleges that the bond issuance includes special clauses benefiting Brookfield at shareholders' expense. The bond was issued at a higher interest rate (7.125%) than similar bonds trading at around 6%, suggesting potential value extraction from shareholders. Mason requests disclosure of the bond indenture terms to assess the potential impact on shareholders.