M&A lessons from EU’s maximum $476M fine against Illumina
The European Commission imposed maximum disciplinary measures in fining U.S.-based biotechnology company Illumina 432 million euros (U.S. $476 million) regarding its “gun-jumping” merger with cancer detection company Grail.
The penalty, announced July 12, represents the 10 percent of worldwide annual turnover that the European Commission is capable of ordering a company to pay under European Union merger regulations. The commission also levied a “symbolic” fine of €1,000 (U.S. $1,100) against Grail for its involvement.
The commission said Illumina’s actions in merging with Grail before receiving EU approval represented an “unprecedented and very serious infringement” of the bloc’s merger control system. The regulator accused the company of “knowingly and intentionally” breaching EU rules by weighing the risk of a fine against the costs of a failed takeover of Grail.
For its part, Illumina said via a spokesperson emailed statement it would appeal the fine, which it found to be “unlawful, inappropriate, and disproportionate.”
The case offers broader lessons for the M&A landscape, including the following: