Salem Radio Network News Friday, October 22, 2021

Business

Illumina faces EU interim measures after gun-jumping Grail deal

By Foo Yun Chee

BRUSSELS (Reuters) -U.S. life sciences company Illumina faces interim measures for closing its $8 billion cash-and-stock takeover of cancer detection test maker Grail before gaining approval for the deal, EU antitrust regulators said on Monday.

Illumina closed the Grail takeover last month and said it would hold the company separate while waiting for a European Commission decision on the deal, defying EU merger rules against gun-jumping.

Previous instances of gun-jumping have resulted in companies being hit with million-euro fines. Sanctions can be as much as 10% of a company’s global turnover.

The EU competition enforcer said it had sent a statement of objections to the companies, setting out the interim measures it plans to take. It did not provide details.

Under EU merger rules, the competition watchdog can order companies to unwind their deals or sell off shares or assets acquired for violations.

Commission Vice-President Margrethe Vestager underlined the seriousness of Illumina’s actions, saying it was the first time companies had openly implemented a deal while regulators were still investigating.

“The standstill obligation is a cornerstone of our ex-ante merger control regime which aims at preventing harmful effects to competition while our review is ongoing,” she said in a statement.

The Commission said the interim measures aim to restore and maintain effective competition pending a final decision on the deal.

“The envisaged interim measures take note of Illumina’s own unilateral proposal to hold Grail separate, but go beyond Illumina’s proposal in addressing a number of serious shortcomings identified in that proposal,” it said.

The Commission will make a final decision on the measures after receiving the companies’ response.

(Reporting by Foo Yun Chee; Editing by Jan Harvey)

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