Illumina accused by Brussels of “delaying tactics” on the sale of Grail

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Brussels has accused Illumina of using “delaying tactics” to prevent a quick decision on whether the world’s largest gene sequencing company should be forced to divest cancer test developer Grail.

This follows repeated claims by Illumina that it is moving as “quickly as possible” to resolve disputes over its $8 billion acquisition of Grail, which is the subject of a deadly proxy battle led by Carl Icahn, the veteran activist investor.

A delay could lead to months of waiting for an outcome as investors seek certainty about Grail’s future. U.S. antitrust regulators have also ordered the surrender of Grail in April, a decision that Illumina is appealing.

EU antitrust authorities blocked the case in September, over concerns it would harm competition, after the company closed the deal without regulatory approval.

Illuminated later appealed the decision and opposed a request from Brussels for an expedited final decision on whether to get rid of Grail, according to four people with direct knowledge of the matter.

The accelerated procedure allows Luxembourg judges to rule quickly on the merits of a legal battle in cases deemed urgent.

“Illumina doesn’t want a quick process through the courts, they’re playing stalling tactics,” a person with direct knowledge of the matter alleged. from the EU position.

“The way Illumina is behaving contradicts its claim that it wants to fix the problem quickly,” the person added.

While the company is fully exercising its legal rights to defend itself, any delay could buy time to sell Grail for better market value, said a person familiar with the company’s strategy.

Illumina has also appealed a decision by the European Commission to review the case despite Grail having no income in Europe. This case will be decided by the Court of Justice.

Assimakis Komninos, a partner at law firm White & Case, who is not involved in either of the two Illumina cases, said: “It makes sense for Illumina to wait because if it wins in court on a decision separate on whether the EU has jurisdiction in the case, everything will fall apart like a domino effect.

The European Commission declined to comment.

Illumina replied, “We are pleased that the Tribunal has granted priority treatment to our appeal, as we share the [European Commission’s] objective of settling the case quickly. However, unlike the US appeal where expedited processing guarantees full disclosure to both parties, here the EC’s request for expedited processing was entirely unilateral.

“The EC’s request would have unfairly deprived us of any opportunity to respond in writing to the EC’s detailed arguments on appeal and would also have deprived intervenors of any opportunity to present their views in writing, thereby limiting their ability to participate in the proceedings. .”

The revelations come after Icahn launched one of the biggest proxy battles in years over what he described as the company’s “reckless” acquisition of Grail.

Illumina shareholders ousted company chairman John Thompson in a vote at its annual meeting on Thursday, earning Icahn-nominated Andrew Teno a board seat. administration.

Two other Icahn nominees failed to garner enough votes to win board seats, paving the way for the re-election of Illumina CEO Francis deSouza and director Robert Epstein.

Analysts said the vote to oust Thompson reflected Illumina shareholders’ desire to expedite the legal process around acquiring Grail and divesting the company.

“We believe the Illumina board heard the message loud and clear, and we’d be curious to see how the messaging on Grail changes in the future,” said Evercore ISI analyst Vijay Kumar.