The European Commission has adopted, under the EU Merger Regulation (‘EUMR'), restorative measures requiring Illumina to unwind its completed acquisition of Grail, following the Commission's decision to prohibit the transaction.
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On 6 September 2022, the Commission prohibited the acquisition of Grail by Illumina over concerns that the merger would have stifled innovation and reduced choice in the emerging market for blood-based early cancer detection tests.
Illumina and Grail unlawfully completed the merger during the Commission's in-depth investigation, in breach of EU merger control rules. In July 2023, the Commission fined both companies for implementing their proposed merger before approval by the Commission.
With this decision, the Commission has adopted restorative measures requiring Illumina to divest Grail and restore the situation prevailing before the completion of the acquisition.
The Commission thus orders the following measures: divestment measures requiring Illumina to unwind the transaction with Grail; and transitional measures that Illumina and Grail need to comply with until Illumina has dissolved the transaction.
Specifically, the divestment measures must be implemented in line with the following principles:
• First, the dissolution of the transaction must restore Grail's independence from Illumina to the same level enjoyed by Grail prior to the acquisition. Restoring Grail's independence will remove the harm to competition resulting from Illumina's ability and incentive to delay or disadvantage Grail's rivals.
• Second, Grail must be as viable and competitive after the divestment as it was before Illumina's acquisition. This will ensure that the innovation race between Grail and its rivals can continue in conditions similar to those in place before the transaction.
• Finally, the divestment must be executable within strict deadlines and with sufficient certainty, so that the pre-transaction situation can be restored in a timely manner.
Illumina can choose the appropriate divestment methods provided that it follows all the principles mentioned above. Illumina has to submit a concrete divestment plan for the disposal of Grail, which must be approved by the Commission. ■