Illumina Says it Will Purchase Bezos-Backed Grail for $8B

Illumina, a global leader in genomics, announced this week that it will be acquiring the remaining stake in Jeff Bezos-backed gene-sequencing company Grail that it doesn’t already own for $8 billion in cash and stock.
The early stage cancer-detection healthcare company, backed by Amazon CEO Jeff Bezos, said that it will acquire Grail for $3.5 billion in cash and $4.5 billion in shares.

The deal gives access to Grail’s specialized blood testing technology platform for early cancer detection.

The stock portion of the deal is now subject to a collar, which will ensure Grail shareholders excluding Illumina “receive a number of Illumina shares equal to approximately $4 billion in value if the 20-trading-day volume weighted average price of Illumina stock as of 10 trading days prior to closing is between $295 and $399,” the companies announced.

Once the transaction closes, current Illumina stockholders are expected to own approximately 93% of the combined company, while Grail stockholders are expected to own about 7% based on the mid-point of the collar.

The companies said the cash part of the deal will be funded using balance sheet cash of both Illumina and Grail, plus up to $1 billion in capital raised through either a debt or equity issuance.

Illumina launched Grail as a separate company in 2016 to allow it to focus on developing data science and machine learning technology that screens for early stage cancers with a platform called Galleri.

The platform has far been able to detect more than 50 cancer types, over 45 of which have no recommended screening in the U.S.

Galleri is expected to launch commercially in 2021 as a multi-cancer, laboratory developed test for early cancer detection from blood, the companies said.

“Galleri is among the most promising new tools in the fight against cancer, and we are thrilled to welcome Grail back to Illumina to help transform cancer care using genomics and our NGS platform,” Illumina CEO Francis deSouza said in a statement.

“Combining forces with Illumina enables broader and faster adoption of Grail’s innovative, multi-cancer early detection blood test, enhancing patient access and expanding global reach,” said Grail CEO Hans Bishop.
Earlier this month Grail filed with the Securities and Exchange Commission to go public.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.