23andMe bankruptcy bid deadline extended as DNA privacy woes linger

By Steven Church | Bloomberg

The sale of the bankrupt DNA data bank 23andMe is facing delays as the company tries to find a lead bidder that can quickly clear regulatory hurdles and guarantee customer privacy rules will be honored.

The former Silicon Valley startup co-founded by Anne Wojcicki has been negotiating with potential buyers trying to land a binding, opening offer that would be used as a floor for a court-supervised auction. The deadline has been extended twice so far. The new date for the company to name an opening bidder is now Wednesday, according to court papers.

The firm, which was valued at $3.5 billion when it went public in 2021 via a merger with a Richard Branson-founded blank-check company, hasn’t been profitable since its listing, despite collecting DNA from saliva samples from more than 15 million customers.

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Now, those samples — and the genetic data they yielded — have become the bankrupt company’s most marketable asset, and the prospect of the sensitive information being put up for auction has sparked anxieties among customers worried about how and where of their personal data may be used. Bankruptcy officials have also raised concerns.

23andMe must win court approval of a “stalking horse bid” — which would then kick off a process by which higher offers could be made — by May 7 in order to unlock another $25 million in loans from the lenders financing the Chapter 11 bankruptcy, court records show.

A buyout offer from Wojcicki was rejected in March. Earlier in April, the US Justice Department said it may review a potential sale for national security risks. The company has warned buyers from the beginning of the case that it would not accept bids from firms with ties to certain countries.

In the months leading up to the March 23 bankruptcy filing, the company had tried to attract a buyer at the same time it was struggling to end a class action lawsuit related to a 2023 data breach that gave hackers access to customer information. The company will try to resolve those claims as part of the bankruptcy.

The case is 23andMe Holding Co., number 25-40976, in the US Bankruptcy Court for the Eastern District of Missouri.

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