Federal Govt Clears BGI’s Acquisition of Complete Genomics

BGI-Complete Genomics-Illumina Saga

BGI-Complete Genomics

BGI announces that US federal govt, Committee on Foreign Investment in the United States (“CFIUS”), has cleared  BGI’s acquisition of US sequencing company Complete Genomics.  In September, BGI-Shenzhen, the leading Chinese company in offering sequencing services  announced that it is acquiring California based Complete Genomics for about $117.6 million.

In November, Illumina got in to the acquisition picture by offering an unsolicited offer.  Upon rejection, Illumina raised privacy and national security issues in BGI,  a chinese company, acquiring Complete Genomics, the american company. According to a report by NYTimes, even a few US scientists expressed concerns on the protection of privacy of genetic data.

The merger still needs a clearance from FTC for antitrust and with FTC approval, it will be all green for BGI’s acquisition of Complete Genomics.

Timeline: BGI-Complete Genomics-Illumina Saga

September 15: In a surprise move, BGI-Shenzhen announced that it is acquiring Complete Genomics for about $117.6 million.

November: Illumina offered an unsolicited offer to acquire Complete Genomics for $123.5  million and Complete Genomics rejects the offer.

November 20:   Reacting to COmplete Genomics’ rejection, Illumina sent a  letter to Complete Genomics’ Board  of Directors and raised the privacy and  national security issue by stating

National security, industrial policy, personal identifier information protection and other concerns raised in connection with an acquisition of Complete Genomics by a foreign state owned entity create meaningful uncertainty around a BGI acquisition, and represent a material risk for your shareholders.

December 13: Complete Genomics’ CEO Cliff Reid rejected Illumina’s national security issue by saying

We believe that our merger with BGI raises no national security concerns.

In the letter to its employees Complete Genomics’s CEO Cliff Reid also threw more light on what went on in the background during its acquisition talks

 Illumina made a proposal to acquire Complete in the publicly-announced process that began in June 2012. Illumina then withdrew its proposal and withdrew from that process in late August 2012. More than two months later – and nearly eight weeks after Complete announced its merger agreement with BGI – Illumina submitted an unsolicited and non-binding proposal to our Board.

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