Jun 4, 2024 - Business

Illumina approves Grail spinoff plan

Illustration of a double helix made out of a $100 bill.

Illustration: Gabriella Turrisi/Axios

Illumina on Tuesday said its board has approved plans to spin off Grail, the early cancer screening company it founded, spun off, and then reacquired for $8 billion over the objections of antitrust regulators in both the U.S. and Europe.

Why it matters: This saga is a stark warning to other companies that may seek to close deals before securing antitrust approval, via a faulty "toothpaste out of the tube" strategy.

  • Not only was Illumina ultimately fined and forced to divest Grail, but its decisions also caused activist investor Carl Icahn to launch a proxy fight and sue the company.

Details: Illumina shareholders will receive one Grail share (Nasdaq: GRAL) per six Illumina shares, with Illumina retaining a 14.5% stake in Grail after the June 24 spinoff.

  • Illumina shares closed yesterday at $103.37, which is down nearly 25% for the year.
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