© Reuters EU fines Illumina (ILMN) €432M for completing Grail acquisition without approval
The European Commission has fined Illumina (NASDAQ:) approximately €432 million ($476.2M) for implementing the proposed merger with Grail before receiving the approval. This is a record fine and Illumina spokesperson told CNBC the company plans to appeal the fine.
EU opened an in-depth investigation into Illumina’s $7.1 billion acquisition of Grail, before eventually blocking the transaction “over concerns that it would have significant anticompetitive effects, stifling innovation and reducing choice in the emerging market for blood-based early cancer detection tests.”
While the review was still in process, Illumina publicly announced that it had completed its acquisition of Grail. Such actions were in breach of EU merger control rules, the Commission said in a ruling. The fine amounts to 10% of Illumina’s global turnover, the maximum allowed under EU merger rules.
“In today’s decision, the Commission confirms its preliminary view that Illumina and GRAIL intentionally breached the standstill obligation. The Commission found that by closing the transaction Illumina was able to exercise a decisive influence over GRAIL and it actually exercised it,” it is said in the press release.
In April, the U.S. Federal Trade Commission (FTC) ordered Illumina to divest its controversial acquisition of Grail.
“The Commission found that the acquisition would diminish innovation in the U.S. market for [multi-cancer early detection] tests while increasing prices and decreasing choice and quality of tests,” the FTC said in a press release.
“This is extremely concerning given the importance of swiftly developing effective and affordable tools to detect cancer early.”
Last month, Illumina said it filed an appeal against an FTC order.
ILMN shares are down 0.7% in premarket Wednesday.
