Benzinga - by Vandana Singh, Benzinga Editor.
Nearly four years after first pitching for Grail Inc. (NASDAQ:GRAL), Illumina Inc. (NASDAQ:ILMN) announced Monday that it would spin off the cancer blood test developer.
In July 2021, Illumina said it was committed to re-acquiring Grail.
Starting today, 25 June, Grail will begin trading the “regular way” under its own Nasdaq ticker, GRAL, as an independent public firm.
Earlier this month, Illumina laid out its plans for the Grail spin-off and said its shareholders will retain their current shares of Illumina common stock and, on the distribution date, also receive one share of GRAIL common stock for every six shares of Illumina common stock.
Illumina will maintain a 14.5% share of the company.
As previously disclosed, Illumina entered into a 364-day delayed draw credit agreement that provided for a senior unsecured term loan credit facility in an aggregate principal amount of up to $750 million at a borrowing rate of approximately 6.70%.
In December, Illumina agreed to divest Grail as the companies battled with the U.S. and European antitrust regulators for almost three years after announcing the acquisition.
In March, an adviser to Europe’s top court criticized the decision to block Illumina’s $7.1 billion bid for Grail, stating that they exceeded their powers.
Last year, in July, the European Commission fined Illumina approximately $463 million (432 million euros), and Grail $1,072 (1,000 euros) for implementing their proposed merger before approval by the commission, in breach of EU merger control rules.
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“As we turn the page, we are excited to share our plan to accelerate topline growth, achieve operational excellence, deliver for our customers, and maximize value for shareholders in our upcoming strategy update,” said Jacob Thaysen, CEO of Illumina.
“Illumina is prepared to lead the next era of innovation in next-generation sequencing by continuing to focus on strengthening our business and catalyzing the industry with an even greater focus on our customers’ priorities.”
Grail CEO Bob Ragusa told Reuters that Grail’s cancer blood test, Galleri, can detect multiple types of cancer early and targets 80% of cancers currently not screened for, which results in cancer deaths.
Reuters noted the company is conducting two major clinical trials, one in the U.K., to support an FDA approval application in early 2026. If approved in the U.S., the test could be widely used.
Price Action: ILMN shares closed at $110.24 on Monday.
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