Illumina, the embattled diagnostics company at the heart of a years-long antitrust battle over its acquisition of cancer test manufacturer Grail, has finally put an end to the saga by announcing that it will divest the company in 2024.
The announcement follows the company’s filing of a Form 10 with the Securities and Exchange Commission on 11 December, the first official step the company had taken to move towards divestiture.
Illumina’s issues began in 2021 when it pursued the acquisition of its old subsidiary Grail during a waiting period imposed by the European Commission (EC), which subsequently levelled its largest-ever fine against the company and ordered the deal be undone.
Things only worsened when the Federal Trade Commission (FTC) in the US came to the same conclusion, fearing that as one of the only companies equipped to process the tests Grail manufactures Illumina would use the acquisition to prevent competition in the space.
The company had up until Sunday (17 December) pursued a dual strategy, inching closer to divesture whilst continuing to appeal the decisions in court, but a mixed ruling by a US court of appeals appears to have changed its mind.
While it was not an outright loss, the failure to get the ruling overturned meant that continuing with the legal battle would have been expensive and risky – two things that investors in the company, some of whom were already threatening legal action, were unlikely to take kindly to.
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They appear to be more positive towards this course of action, though. Illumina’s share price is up 32.8% over the past month and spiked particularly last week following the announcement that it had filed its Form 10.
The divesture will not prevent Illumina from processing tests that Grail manufactures and is expected to take the form of a third-party sale or capital transaction, per the press release. At the end of November, Illumina’s CEO implied that there was outside interest in Grail, though he declined to elaborate further.
Despite its recent woes, GlobalData analysis of Illumina corporate filing documents suggests that the company is still confident, at least in public.
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