Benzinga | Jun 30, 2021 05:24AM EDT

Grifols Announced Strategic Investment from GIC of $1B

Grifols (NASDAQ:GRFS) and GIC, the sovereign wealth fund of Singapore, have entered into a definitive agreement under which GIC will invest D 1 billion in Grifols' wholly owned US subsidiary Biomat USA. As part of the transaction, GIC will become a strategic investor in Grifols' business, holding a minority stake in Biomat USA through the acquisition of newly issued non-voting stock.

Biomat is a global leader in plasma collection, with a network of 296 U.S.-based plasma collection centers.

Grifols will continue to oversee all aspects of Biomat's management and operations. All plasma collected by Biomat and its subsidiaries will continue to be supplied to Grifols for the production of plasma-derived medicines, through a long-term plasma supply agreement.

Grifols' leadership in the manufacture of plasma-based medicines, extensive expertise in the expansion and management of plasma centers, market know-how, and outstanding reputation were all key factors in GIC's decision to invest in the company.

As Grifols' co-CEO Vctor Grfols Deu notes, "We are pleased to welcome GIC as a strategic investor to bolster and expand our U.S. plasma center network, which is a clear competitiveadvantage. This transaction supports Grifols' business model and our strategy in plasma collection, together with a solid innovation portfolio focused on disease management beyondthe therapies based on plasma-derived medicines. With robust demand for Grifols' plasma proteins, our efforts remain centered on doing our best to respond to the needs of patients and healthcare professionals."

Page 2 of 3Grifols will apply all proceeds from GIC's investment to repay debt as part of its ongoing commitment to gradually reduce financial leverage. In the first quarter of 2021, Grifols' netfinancial debt totaled EUR 6,200.5 million1 and its net financial debt/ EBITDA ratio was 5.1x following the acquisitions of plasma centers from BPL and Kedrion and Grifols' transaction with GigaGen.

The closing of GIC's strategic investment in Grifols is subject to certain conditions, including applicable regulatory authorizations, such as the Committee on Foreign Investment in theUnited States (CFIUS). Grifols retained Osborne Clarke, S.L.P and Proskauer Rose, L.L.P as legal advisors for the transaction, and Nomura Securities International, Inc. as sole financial advisor. GIC retained Dechert LLP as legal advisor.