In early trading on Wednesday, shares of Grifols, a Spanish drugmaker (GRLS.MC), dropped by 15% after a new study from Gotham City Research cast doubt on the "transparency, integrity, and ethical conduct" of the Barcelona-based company.
The short-sheller has been accusing Grifols of regularly distorting its financial records since early January, causing the firm's market value to drop by billions of euros.
As previously stated, Grifols has responded to all of the inquiries made in Gotham City's reports and thereby denies the claims. Regarding the most recent allegations, it chose not to comment.
Grifols muddied the waters in its 2022 annual report on a 319 million euro ($346.6 million) loan, Gotham said on Wednesday.
The transaction was classified by Grifols as "other financial assets with other related parties," but according to Gotham, it was actually a cash pooling financing agreement between Grifols and Scranton Enterprises, the family business of the Grifols.
"Neither detailed, nor correctly identifies the nature of the transactions" was Grifols' explanation of the loan, according to Gotham.
With this new information "thus indicating that Grifols’ claim that it had already answered our questions was incorrect," the hedge fund continued by saying that it thought the "cash pooling revelation" was fresh.
After a report indicated accounting issues, Grifols claimed in January that it had sued Gotham City's creator Daniel Yu and his company in a U.S. court, seeking damages.
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