(Reuters) -Illumina’s board has approved a spinoff of Grail, the gene sequencing machine maker said on Monday, as the deal to take the company back into its fold three years ago faced immense antitrust scrutiny and opposition from investor Carl Icahn.
Shareholders will receive one common share of Grail for every six shares of Illumina, which will retain a 14.5% stake in the unit after the spinoff on June 24. Shares of Illumina were up 4% in extended trading.
The gene sequencing machine maker founded Grail and spun it off in 2016, but re-acquired it in 2021 for $7.1 billion to enter the cancer early-detection market.
The deal was opposed by antitrust regulators over concerns Illumina would stop Grail’s rivals from accessing its technology to develop competing blood-based early cancer detection tests.
The EU regulator had fined Illumina a record 432 million euros ($471.18 million) in July last year since it had closed its takeover before securing antitrust approval.
Grail’s greater-than-expected expenditures and delays in advancing its tests had also forced Illumina to take impairments that Icahn said in December had totaled $4.7 billion.
($1 = 0.9168 euros)
(Reporting by Puyaan Singh in Bengaluru; Editing by Anil D’Silva)
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