SAN FRANCISCO — Genetic testing company 23andMe Holding Co. (Nasdaq: ME) filed for Chapter 11 bankruptcy protection in the Eastern District of Missouri on Saturday and secured up to $35 million in debtor-in-possession (DIP) financing from JMB Capital Partners to support operations during a court-supervised asset sale.
The voluntary filing marks a major shift for the once high-flying biotech firm, which said it intends to continue operating normally throughout the restructuring process while seeking a buyer for substantially all of its assets.
The company, which cited operational and financial headwinds, also plans to use the Chapter 11 proceedings to resolve liabilities from a 2023 cyberattack and to cut costs, including terminating leases for its Sunnyvale and San Francisco offices.
“After a thorough evaluation of strategic alternatives, we have determined that a court-supervised sale process is the best path forward to maximize the value of the business,” said Mark Jensen, newly appointed Chair of the Board.
The DIP financing is subject to court approval and is expected to provide enough liquidity, alongside ongoing revenue, to maintain operations during the 45-day sale process. If multiple bids emerge, 23andMe intends to hold an auction.
The filing follows the board’s recent rejection of a non-binding takeover proposal from co-founder Anne Wojcicki and her affiliates. Wojcicki stepped down as CEO as part of the restructuring, though she remains on the board. CFO Joe Selsavage has been named interim CEO, and restructuring veteran Matt Kvarda was appointed Chief Restructuring Officer.
Customer data protections will remain unchanged during the process, the company emphasized, and any buyer will be legally obligated to maintain privacy standards.
Legal and financial advisors include Paul, Weiss; Morgan Lewis; Moelis & Co.; and Alvarez & Marsal.
More information is available at https://restructuring.ra.kroll.com/23andMe.
