23andMe files for bankruptcy, appoints interim CEO

23andMe, the biotechnology and genetics company known for its DNA testing which revealed the ancestry of customers, has filed for voluntary chapter 11 bankruptcy. The decision to file for bankruptcy was made following the company's inability to resolve the operational and financial challenges it has faced for years. This comes after a security breach in 2023 that affected nearly 7 million customers.

According to an official statement released to GlobeNewswire, the chairman and member of the special committee of the board of directors, Mark Jensen is quoted to have said 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,

The press release also revealed that the company plans to sell substantially all of its assets, and once approved by the court, it will accept qualified bids over a 45-day period. If multiple bids that qualify are submitted, the company plans to conduct an auction to get the maximum value for its assets. It is important to state that the special committee of the board of directors rejected an acquisition proposal submitted by Anne Wojcicki, who has served as CEO of the company since it was founded in 2006.

It has also been announced that Ms. Wojcicki will be resigning from her role as the CEO but will remain a member of the board. The resignation takes place with immediate effect, and in the interim, the company's Chief Financial and Accounting Officer, Joe Selsavage, will serve as CEO. In a post on X announcing her resignation, Ms. Wojcicki says she intends to be a bidder despite the initial rejection of her acquisition proposal which would have seen the company return to being private.

23andMe was initially valued at $6 billion in 2021 after it became a publicly traded company thanks to a merger with VG Acquisition Corp, a special-purpose acquisition company owned by Richard Branson. However, by 2024, its valuation had crashed to just 2% of that. The company not only offered customers the chance to learn about their ancestry but also discover important details about their health.