Illumina loses challenge against EU antitrust probe into Grail deal
Illumina (ILMN.O) on Wednesday lost its challenge in Europe’s second-highest court against the European Union having scrutiny over its $8 billion cash-and-stock takeover of fellow U.S. life sciences firm Grail (GRAL.O).
The case is important for EU antitrust chief Margrethe Vestager who wants to expand the European Commission’s power to examine acquisitions of startups by big companies that could seek to shut nascent rivals, particularly in tech and pharmaceuticals deals.
Her critics see it as a power grab that has triggered alarm bells at some national competition agencies.
Illumina said it would appeal the General Court ruling to the Court of Justice of the European Union, Europe’s highest.
That could take years and it is unlikely the EU competition agency will wait before deciding whether to clear or block the deal.
It halted its probe into the deal in February while waiting for the court ruling.
“As regards the Phase II investigation into the Illumina/Grail case, proceedings are currently suspended and will continue as soon as the clock restarts,” a Commission spokesperson said.
The General Court swiped away Illumina’s arguments.
“The Commission has the competence to examine that concentration which did not have a European dimension or fall within the scope of the national merger control rules of member states of the European Union or states party to the agreement on the European Economic Area,” the Court said.
Judges rejected Illumina’s complaint that the EU competition enforcer’s action had up-ended legal certainty and legitimate expectations in the merger process.
They said the company had failed to show that it “received precise, unconditional and consistent assurances, originating from authorised, reliable sources, such as to lead him or her to entertain well-founded expectations”.
The Commission said it took up the Illumina case at the request of Belgium, France, Greece, Iceland, the Netherlands and Norway even though the deal did not require approval from these countries because Grail had no activities in Europe.
Illumina announced the deal in September 2020 that would give it access to Grail’s flagship Galleri blood test used to diagnose cancers at early stages when the disease is easier to treat.
It completed the acquisition in August 2021 without waiting for EU clearance and was subsequently told to keep Grail separate and to have independent managers run the company until regulators finalised their investigation in another procedure.
The case is T-227/21 Illumina v Commission.