Grifols Slumps on The Deal Report That U.S. May Seek to Block Talecris Buy

Grifols SA, Europe’s largest maker of blood-plasma products, fell the most in four months in Madrid trading after The Deal reported that U.S. antitrust regulators will seek to block the company’s purchase of Talecris Biotherapeutics Holdings Corp.

The Federal Trade Commission is preparing a lawsuit to halt the $3.63 billion purchase, The Deal reported, citing a Washington antitrust lawyer familiar with the agency’s investigation. Mitchell Katz, a spokesman for the commission, declined to comment. Both companies said they had no knowledge of FTC plans to try to block the transaction.

“Nothing has changed,” Grifols Deputy Chief Financial Officer Nuria Pascual said in a phone interview today. “We have had absolutely no notification or information or any additional knowledge on the type of things the article in The Deal mentioned. We don’t share any of the views that have been included there.”

Should the FTC seek to block the deal, it would be the second time Research Triangle Park, North Carolina-based Talecris faced opposition to a sale on antitrust grounds. CSL Ltd. scrapped a proposed $3.1 billion acquisition of Talecris in 2009 following an objection by the agency. Talecris Chief Executive Officer Lawrence Stern hinted in an employee newsletter last month that the sale to Grifols may not go through, the Raleigh News & Observer reported last week.

Grifols’ Timetable

Approval of the acquisition would reduce the number of companies within the blood plasma industry to three and the FTC is determined to preserve the competition Talecris has bought to the market, according to The Deal.

Grifols expects a resolution to the FTC review by the end of the year, and completion of the purchase in early 2011, Pascual said today. “The deal is under review by the FTC and they have not taken any formal position on the deal at this time,” Becky Levine, a spokeswoman for Talecris, said by e- mail. She declined to comment on the report.

Grifols lost 53 euro cents, or 4.5 percent, to close at 11.04 euros at 5:30 p.m. Madrid time, the biggest decline since June 29. Talecris declined 81 U.S. cents, or 3.3 percent, to $23.61 at 4 p.m. New York time in Nasdaq Stock Market composite trading.

“Whether U.S. and global regulatory authorities approve the merger with Grifols, or we are once again left standing at the altar, I’m confident we have the strategies, plans and entrepreneurial team to embrace change and actively shape our destiny,” Stern, the Talecris CEO, wrote in the employee newsletter, according to the News & Observer. Levine confirmed that the report was accurate.

Grifols’ Timetable

Grifols Chief Executive Officer Victor Grifols said on a conference call June 7, the day the acquisition was announced, that he didn’t foresee any problems with the FTC and the acquisition probably would close in the fourth quarter.

“It seems to be taking longer than most people had anticipated and when that happens that does certainly interject some uncertainty into the situation,” John Putnam, an analyst at Capstone Investments Inc. in Milwaukee, said in a phone interview today. He has a “hold” rating on Talecris.

The acquisition of Talecris isn’t likely to be blocked by the FTC because Grifols has little presence in the U.S., UBS analysts, including New York-based Bruce Nudell, wrote in a note Oct. 25. The commission and Grifols appear to be negotiating a settlement that probably will involve the sale of Talecris’s Melville plant to either Octapharma AG or Biotest AG, the analysts said.

Talecris stockholders will receive $19 in cash and 0.641 of a newly issued, non-voting Grifols share for each Talecris share. The deal valued Talecris at about $28.93 a share based on today’s closing price for Grifols.

Cerberus Capital Management LP, a New York-based private- equity firm, owns about 49 percent of Talecris.

To contact the reporters on this story: Chris Kay in London at ckay5@bloomberg.net

To contact the editors responsible for this story: Phil Serafino at pserafino@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.