Illumina Expects EU to Issue Objections to Grail Deal
(Bloomberg) -- Illumina Inc. said it expects European Union regulators to issue formal objections to its $8 billion acquisition of cancer-test provider Grail on Wednesday.
The EU, which is weighing whether the deal would prevent other companies from bringing innovative tests to market, will likely issue a so-called statement of objections, San Diego-based Illumina said. Though such a statement raises a red flag for a potential veto, it also gives companies an opportunity to challenge the EU’s legal case or offer concessions.
The deal review is one of several legal battles for Illumina, which closed the acquisition without EU approval. The company risks a potential $400 million fine and last month was ordered to run the business separately during the EU probe.
Grail has no business in Europe and a deal veto would delay the rollout of cancer tests in the region by many years, Illumina said in a briefing paper for European competition authorities who screen the EU’s final decisions. Closing the deal would save lives and health care costs and “this is therefore not a case that” the EU “should prohibit,” the company said.
The EU’s arguments that the deal may be anticompetitive are “highly speculative and unfounded by any evidence,” it said. “This is not a ‘killer acquisition’ as Illumina and Grail are not competitors.”
Illumina is fighting antitrust reviews on both sides of the Atlantic in its bid to re-purchase Grail, which it launched in 2016 but subsequently spun off. U.S. antitrust authorities sued to block the deal immediately at a federal court in March but later dropped that complaint to move to an administrative trial.
The company is also challenging the EU’s move to review the deal, which is regulators’ first attempt to examine a deal that doesn’t meet its usual thresholds. Officials changed their policy earlier this year to pick up high-priced bids for low- or zero-revenue targets that they see as harmful to competition.
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