Seven of eight members of 23andMe’s board have resigned in yet another blow to the struggling genetics company. The CEO is now the only remaining member.
The independent directors of the genetic testing firm said in a letter posted Tuesday that they were quitting the company’s board after not receiving a satisfactory buyout offer from the CEO, Anne Wojcicki.
“After months of work, we have yet to receive from you a fully financed, fully diligenced, actionable proposal that is in the best interests of the non-affiliated shareholders,” said the seven directors, including the CEO of YouTube, in a letter to the company’s co-founder and CEO.
In a memo to employees reported by the Wall Street Journal, Wojcicki responded: “I am surprised and disappointed by the decision of the directors to resign.” She maintained that taking the company private was still its best strategic option and said she would conduct a search for new board members.
Wojcicki, who has been trying to take the company private since April, had proposed to acquire all outstanding shares of 23andMe not owned by her or her affiliates for $0.40 a share in July. She controls 49% of voting shares in the company.
A special committee formed by the company rejected the proposal, deeming it insufficient and not in the best interest of the non-affiliated shareholders. They also said the special committee was unwilling to consider further extensions and that the company’s board agrees with it.
“That we have not seen any notable progress over the last 5 months leads us to believe no such proposal is forthcoming,” the directors added. Earlier this month, Wojcicki said she would be open to considering third-party takeover proposals for the company.
23andMe’s share price fell to a new low of $0.30 in response to the board’s mass resignation, bouncing back to $0.35 the next day. According to WSJ, the company is now worth less than the cash it has in its reserves. Financial publications have taken to calling 23andMe a penny stock.
23andMe, best known for its saliva-based test kits that offer users a glimpse into their genetic ancestry, went public in 2021. Since then, it has never turned a profit, and the company is in danger of burning through its cash reserves entirely by next year. Throughout 2023 and 2024, 23andMe has also struggled with the fallout from a disastrous hack that saw the personal information of nearly 7 million users stolen.
