DNA testing company 23andMe goes bankrupt after failing to acquire buyer, CEO Anne Wojcicki resigns
DNA testing company 23andMe Holding Co. has filed for Chapter 11 bankruptcy after it couldn’t find a buyer to avoid bankruptcy proceedings and its co-founder and CEO Anne Wojcicki resigned.
On Sunday, the San Francisco-based company announced it would sell “basically all assets” through a court-approved restructuring plan.
23AndMe was founded nearly twenty years ago and has faced an uncertain future for some time. In addition to private battles, it has been struggling to find profitable business models since its public disclosure in 2021.
According to court documents, the company will continue to market to investors with the goal of obtaining at least one binding offer by May 7.
The deadline is determined by lenders, who are seeking court approval to lend 23 and $35 million to JMB Capital Partners to fund its bankruptcy.
The interest rate for the debt is 14%, and if approved, a 2% commitment fee, a 6% exit fee and a $100,000 work fee will be paid.
“We expect the court oversight process to facilitate efforts to operate and financial challenges we face, including further cost reductions and addressing legal and lease liabilities,” said Mark Jensen, chairman and chairman of the board.
23andMe said in a statement that the St. Louis Chapter 11 document will also address legal issues related to data breaches.
The company also said it plans to continue operations throughout the sales process.
In 2021, the value of DNA testing companies when they were released was US$3.5 billion.
It has $277.4 million in assets and $214.7 million in liabilities, according to court documents.
Wojcicki resigned from her role as CEO but will continue to serve on the board. Joe Selavage was appointed interim CEO.
Saliva-based DNA testing
The company is known for its saliva-based DNA testing suite – millions of customers are eager to learn about their ancestors and further research on health research and drug development.
In September last year, all its independent directors resigned in a rare move after negotiating acquisitions with Wojcicki.
In November, the company announced it would release 40% of its workforce or more than 200 employees and cease its treatment department. The board’s special committee said in January it is exploring strategic alternatives, including possible sales.
Shares of 23andMe Holding Co. have reduced almost all of its value since last spring and are even further after Sunday’s bankruptcy filing, trading below $1 as of noon Monday.
