Now we have news that 23andMe has entered into a deal to merge with Richard Branson's company VG Acquisition Corp (VGAC). VGAC is what is known as a special acquisition company (SPAC), otherwise known as a blank cheque company, which is formed by groups of investors who have set up the company with the sole purpose of making acquisitions and to get them quoted on the stock exchange.
The deal values 23andMe at around $3.5 billion. The transaction is expected to be completed by the end of the second quarter of 2021. Once the transaction has been completed the new merged company will trade on the New York Stock Exchange under the name ME.
As a result of this move, the combined company will have access to a cash fund of around $900 million which will be used to invest in "key growth initiatives across 23andMe’s consumer health and therapeutics businesses".
THANK YOU to all 10M+ customers for your support, feedback & enthusiasm over the last decade. We are excited to be going public and to continue our journey pioneering a new, customer centric, healthcare world. Let’s all BENEFIT from the human genome! @23andMe pic.twitter.com/irMOpm2bbP
— Anne Wojcicki (@annewoj23) February 4, 2021
What are the implications for genetic genealogy?
23andMe is now firmly positioning itself as a personalised healthcare and drug development company and it very much looks as though the investment money is going to be used to expand that side of the business rather than focus on genealogy. 23andMe shared an interesting slide deck from a presentation they gave to investors. The ancestry reports are to be used as the "mass entry point to building a revolutionary database". They will therefore need to ensure that these reports are regularly updated and presented in an appealing way.
From a personal perspective I don't think we will notice much difference. 23andMe has never been particularly useful for genealogy because about 90% of the database is in the US and I've never really had any useful matches at 23andMe. I have, however, found the health and trait reports interesting to read and the company provides some very useful educational material.
I'm hoping that with Richard Branson's involvement 23andMe might pay a bit more attention to their customers outside the US. In October 2020 they launched a new subscription service known as 23andMe+. The subscription costs a modest sum of $29 a year and provides access to pharmacogenetic reports, enhanced ancestry features and access to new reports and features, but is currently restricted to US residents.
We probably won't see any changes until the transaction has been completed but it will be interesting to see how the money gets spent and how the company develops in the next few years.
Further reading
- 23andMe to merge with Virgin Group’s VG Acquisition Corp. to become publicly-traded company set to revolutionize personalized healthcare and therapeutic development through human genetics 23andMe press release, 4 February 2021
- 23andMe slide deck from investors' presentation
- 23andMe goes public with $3.5 billion company with Branson aid by Kristen Brown, Bloomberg News, 4 February 2021
- Why Sir Richard Branson gave 23andMe millions of dollars to go public by Brian Sozzi, Yahoo Finance, 4 February 2021
- Merger with Richard Branson's Spac values 23andMe at $3.5 billion by James Fontanella-Khan and Hannah Kuchler, Financial Times 4 February 2021
- Genetic testing firm 23andMe is going public via a SPAC backed by Richard Branson by Kim Lyons, The Verge, 4 February 2021
- Fears over DNA privacy as 23andMe plans to go public in deal with Richard Branson by Kari Paul, The Guardian, 9 February 2021
Great information about VG Acquisition Corp.buy plus size leather pants at cheap price.
ReplyDelete