Spanish pharmaceutical giant Grifols (GRFS, Financial) is negotiating with banks to refinance its €370 million bonds due in 2025 and extend its €1.4 billion revolving credit facility. This move aims to alleviate investor concerns over its debt repayment capabilities. CEO Nacho Abia highlighted the company's need for financial flexibility, preferring to maintain liquidity over using cash flow for repayments.
Grifols recently became the focus of financial scrutiny after Brookfield Asset Management abandoned its acquisition plans. Brookfield had proposed a €6.45 billion privatization offer, which was rejected by Grifols' board, causing significant stock volatility, including a 14% drop.
Concerns persist over Grifols' ability to repay its debts, particularly with its 2024 free cash flow forecast at only €5 million, below market expectations. Despite reducing its debt to €9.2 billion, analysts remain cautious about its cash generation capacity. Grifols continues to rely heavily on bank support, with mixed responses from financial institutions regarding refinancing efforts.
