NEW YORK – 23andMe announced on Friday that a 1-for-20 reverse stock split of the company's class A and class B common stock will go into effect on Oct. 16.
The reverse stock split will reduce the number of the company's issued and outstanding common shares from approximately 350,292,546 class A shares and 166,443,192 class B shares to approximately 17,514,628 and 8,322,160 shares, respectively.
The Sunnyvale, California-based company's stockholders had previously approved an amendment to 23andMe's certificate of incorporation to combine outstanding shares of the two common stock classes into a smaller number of shares by a ratio of at least 1-for-5 and not more than 1-for-30. The board of 23andMe later approved a reverse stock split ratio of 1-for-20.
The company will begin trading its class A common stock on the Nasdaq Capital Market on a split-adjusted basis on Oct. 16, under a new CUSIP number: 90138Q306.
Every 20 shares of class A and class B common stock issued and outstanding immediately prior to that time will be automatically combined into one share of class A and class B common stock, respectively, with any fractional shares rounded to the next whole number.
The company will proportionally adjust the number of common class A shares to reflect the reverse stock split. 23andMe will also reduce its number of common class A shares available under the company's incentive equity plan and employee stock purchase plan by the same ratio.
23andMe is in the midst of a tumultuous period with a number of board members recently stepping down, citing a lack of progress from CEO Anne Wojcicki in her effort to submit a proposal to take the company private. More recently, Wojcicki said she is not open to hearing third-party takeover proposals, and "it has become even clearer to me that the best path forward … is for me to take the company private."
The firm also recently paid $30 million to settle a data breach lawsuit, and it shut down its therapeutics discovery service.
In Friday morning trade, shares of 23andMe were down 6 percent at around $.28 per share.