Direct-to-consumer genetic testing company 23andMe is merging with VG Acquisition Corp. with the aim of becoming publicly traded, as GenomeWeb reports. It notes VG Acquisition Corp. is a special-purpose acquisition company (SPAC) sponsored by Virgin Group.
The Verge adds that SPACs, in which a group of investors form a company with the aim of taking another one over, have recently become more popular. It notes that this deal between 23andMe and VG Acquisition Corp values the company at $3.5 billion and that current shareholders will own 81 percent of the company.
According to the Wall Street Journal, the deal would also enable 23andMe to shift away from the consumer DNA testing market — which it notes has been slowing — toward a health market. "There is absolutely that slowdown," 23andMe CEO Anne Wojcicki tells the Journal. "We have always seen health as a much bigger opportunity."
GenomeWeb adds that the transaction is expected to be completed during the second quarter and that the combined company's shares will be traded under the 'ME' ticker symbol.