KANSAS CITY, Mo. — Consumer genetics company 23andMe filed for Chapter 11 bankruptcy protection late Sunday night in a federal court in eastern Missouri.
In a press release announcing the filing, the company said it hopes the move will help it “maximize the value of its business” as it enters the process of selling the company.
Sunday night’s announcement also included news the company’s CEO, Anne Wojcicki, would resign her role effectively immediately.
The company says it will continue operating as normal throughout the sales process, quick to point out the move will not change “the way the company stores, manages, or protects customer data.”
“We are committed to continuing to safeguard customer data and being transparent about the management of user data going forward, and data privacy will be an important consideration in any potential transaction,” Mark Jenson, chair and member of the Special Committee of the Board of Directors, said in Sunday night’s press release.
The company says it will seek authorization in bankruptcy court to solicit bids over a 45-day sales process.
“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,” Jenson said.
The company says any buyer “will be required to comply with applicable law with respect to the treatment of customer data and any transaction will be subject to customary regulatory approvals, including, as applicable, approvals under the Hart-Scott-Rodino Act and the Committee on Foreign Investment in the United States.”
News of 23andMe’s financial condition circulated last week, prompting California Attorney General Rob Bonta to issue a consumer alert regarding the company and its data.
While Californians are covered by the California Consumer Protection Act, Bonta’s alert could serve as an alert for residents of other states as well.
“California has robust privacy laws that allow consumers to take control and request that a company delete their genetic data,” Bonta wrote in the alert on Friday. “Given 23andMe’s reported financial distress, I remind Californians to consider invoking their rights and directing 23andMe to delete their data and destroy any samples of genetic material held by the company.”
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