Saturday, December 09, 2017

Examining Grifol's

As mention in the last post: I am examining acquisition chains.

I noticed an ad at a local University soliciting "plasma donations" by a group called Grifols Plasma. The word donation is a bit misleading. Technically what happens in you donate your plasma, but they compensate you for your time. Their site says people can make up to $200 a month donating plasma (I do not know if this is a good deal). They put the money on a prepaid Visa. You must given them your SSN and must have a photo ID. I suspect you have to pay taxes on your compensation.

I went to Wikipedia and found out that Grifols was a Spanish company. Wikipedia had little info on how Grifols entered the US Market.

Anyway, I went to the site and found the site listed 150 centers. The centers had names like Talecris Plasma Resources and BioMat USA. The site did not tell me how these collection resources were related to Grifols.

I googled around for the term "BioMat" and finally found that had something to do with a company called SeraCare. I then discovered articles that claimed Grifols bought SeraCare in 2002 and others that said Linden Capital Partners bought SeraCare in 2012. Linden has a huge list of companies which it bought and sold.

This is what I think happened. A company called "SeraCare" had two divisions. One division collected plasma, the other processed it. They decided to sell the collection centers and began rebranding them as BioMat. Grifols bought the collection centers as a subsidiary in their effort to enter the US market.

There ended up being a financial scandal 2006. So, BioMat collected the plasma. SeraCare bought the plasma. The CEO of SeraCare was on the board of directors for both firms. He was in charge of negotiations and accounting for both firms. This is a guaranteed crisis. A audit discovered discrepancies. The SeraCare stock crashed and several people fired.

The acquisition of Talecris went as follows: Talecris was created in 2005 when Bayer sold it blood processing unit to a private equity firm called Cerberus. Cerberus hoped to sell Talecres to CSL Plasma but was blocked by the FTC. Cerberus began buying up shares of Grifols. Grifols had a market capitalization of $2.36B in 2010. Cerberus arranged a deal in which Cerberus acquired Talecres for $3.4 billion. (The smaller fish swallowed the bigger fish). Cerberus is reported to have made $2B in this deal. The FTC tried to block this merger as well but failed since Grifols was a relatively smaller in US plasma collections at the time.

No comments: