Grifols SA Chief Executive Officer Thomas Glanzmann failed to assuage investor concerns about a critical short-seller report during an investor call on Thursday, with the shares resuming a sharp selloff.
The Spanish blood plasma firm held the call to answer questions about the accounting and corporate government allegations made by Gotham City Research LLC. On the call, executives pledged to simplify the company’s business structure and repay debt.
Glanzmann accused Gotham City of “re-purposing financial information” and acting out of “pure self-interest and financial gain.” He reiterated that the board will take legal action against the fund.
Still, investors responded by selling the stock, sending it down 15% by the close. “Little new info was given at the call, where management mostly reiterated the messages of the past few days,” Alvaro Lenze, an analyst at Alantra Equities, wrote in a note. “We see a missed opportunity to communicate a stronger message” on improving transparency and governance, Lenze added.
Grifols has been in turmoil after Gotham City released its report on Tuesday, which caused a 26% plunge in the stock. The next day, filings showed that Gotham City had slashed its short bet against the company. The stock is down by about 30% since the report’s publication.
Among its accusations, Gotham City said Grifols’s financial statements included earnings from BPC Plasma and Haema, two companies for which Grifols has a call option and that are owned by Scranton Enterprises NV, an investment vehicle for some members of the Grifols’s founding family and a group of former executives. Glanzmann denied this was a family office on Thursday’s call.
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