© Reuters. FILE PHOTO: A sign at the front entrance to the global headquarters of Illumina is pictured in San Diego, California, U.S., November 28, 2022. REUTERS/Mike Blake/File Photo
Illumina announced on Sunday that it plans to divest cancer diagnostic test maker Grail after facing challenges from U.S. and European antitrust enforcers for over two years, as well as opposition from activist investor Carl Icahn.
In a statement, San Diego-based Illumina (NASDAQ:) stated that the divestiture will be carried out through a third-party sale or capital markets transaction, with the terms expected to be finalized by the second quarter of 2024.
The company Grail, which is valued at $7.1 billion under Illumina’s deal, is developing a blood test to diagnose various types of cancer, known as a liquid biopsy.
This decision comes after the U.S. appeals court ruled on Friday that overturned a Federal Trade Commission (FTC) order against Illumina’s acquisition of Grail, citing a misapplication of legal standards by the agency.
The FTC had expressed concerns that Illumina, as the leading provider of DNA sequencing of tumors and cancer cells, might potentially raise prices or refuse to sell to Grail’s test rivals.
Meanwhile, Europe had proposed measures for Illumina to reverse its acquisition of Grail, although Illumina argued that it does not conduct business in Europe and therefore the EU competition enforcer lacks jurisdiction.
Illumina’s acquisition of Grail also faced pressure from investors, including billionaire Icahn, who successfully led a board challenge in May. In October, Icahn sued Illumina, alleging breach of fiduciary duties in the Grail deal.
Neither Grail nor Icahn immediately responded to Reuters’ requests for comment.
