resignation of 23andMe's board of directors has raised significant concerns regarding the company's future and governance. All seven board members resigned, leaving CEO Anne Wojcicki as the sole remaining director, amid ongoing disputes over her strategy to take the company private . This unprecedented move reflects deep-seated disagreements about the direction of 23andMe, particularly concerning Wojcicki's substantial control over the company's voting power, which she holds at 49%. The inability to align on a shared vision for the company has ultimately led to this drastic step.
The move is almost certainly the final nail in the coffin for the embattled company known for its mail-order DNA-testing kit. Since going public via merger with a special purpose acquisition company (SPAC) in 2021, 23andMe has never turned a profit. Its price on IPO day was $10; so far in 2024, it has yet to reach a $1 valuation. Following the resignation of all its independent directors Tuesday, the stock fell to its rock bottom: $0.30. (As of midday Wednesday, it’s back to $0.36.)
Wojcicki submitted a proposal in late July to take the company private, after earlier expressing interest in acquiring the company back in April. The board’s Special Committee rejected her proposal, noting it didn’t provide a premium to the closing price at the time of 40 cents per share and it lacked committed financing.
The Special Committee gave Wojcicki a “limited amount of additional time” to revise her proposal to take the company private.
In their letter Tuesday, however, the board members wrote, “After months of work, we have yet to receive from you a fully financed, fully diligenced, actionable proposal that is in the best interests of the non-affiliated shareholders.”
“We believe the Special Committee and the Board have provided ample time for you to submit such a proposal. That we have not seen any notable progress over the last 5 months leads us to believe no such proposal is forthcoming,” the letter continued, adding that there would be no further extensions to revise such a proposal.
23andMe said it anticipates that approximately $25 million of the total cost will be covered by cyber insurance.
Wojcicki’s resolve comes after her sister, former YouTube CEO Susan Wojcicki, died last month after a two-year battle with cancer.
This loss came less than six months after Susan Wojcicki’s 19-year-old son, Marco Troper, died of an accidental overdose in a UC Berkeley dormitory.
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