Grail Stock Alert: 7 Things to Know as Grail Begins Trading Today

The world of biotech stocks has a new member today. Grail (NASDAQ:GRAIL) has successfully completed its spin-off from the industry leader Illumina (NASDAQ:ILMN). Previously, Grail was the company’s cancer testing division. However, after pressure from regulators, Illumina, known for its advances in DNA sequencing, decided to spin off the company, which would allow Grail to operate as an independent entity. Today, trading in Grail shares begins on the Nasdaq in perhaps one of the hottest stock market debuts of the summer. InvestorPlace Contributor Rich Duprey reports:

“Grail’s Galleri early cancer test is very promising. It can detect 50 different types of cancer at an early stage. Early detection is one of the best hopes of beating cancer. Grail is testing the test with the UK National Health Service and 140,000 participants. It is expected to be completed in the third quarter. The results of the Pathfinder 2 study are expected in 2025 and Grail expects to submit for approval to the Food & Drug Administration in the first half of 2026.”

With that in mind, it’s understandable that Illumina would want to hold on to Grail, especially given its recent advances in cancer testing. But what else do investors need to know about this exciting new stock? Let’s take a closer look at how Grail will spin off from Illumina and begin trading.

GRAL shares: What you should know

• Illumina initially acquired Grail in 2021 for around $8 billion after a lengthy purchase process. This happened before antitrust authorities gave their approval.
• While Grail will now operate as an independent company, Illumina will retain a 14.5% stake in its former subsidiary.
• The company completed the spin-off by distributing more than 85% of Grail shares to Illumina shareholders. Investors received one Grail share for each Illumina share they owned.
• Illumina decided to spin off after EU regulators forced the company to choose between a capital markets transaction and a sale to divest Grail.
• Grail had originally filed for an IPO (initial public offering) in September 2020, raising $2 billion from venture capitalists. At the time, the company was eyeing a 2021 launch of Galleri, its cancer screening test.
• After the takeover, activist investor Carl Icahn waged a proxy war against Illumina and called for the CEO to be removed.
• Newly appointed CEO Jacob Thaysen is optimistic about Illumina’s prospects after the spin-off. He recently stated, “With the completion of the GRAIL spin-off, we have achieved our goal of divesting GRAIL in a way that will continue to benefit patients with its breakthrough technology.”

At the time of publication, Samuel O’Brient had no position (either directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s disclosure policies.

Article printed by InvestorPlace Media, https://investorplace.com/2024/06/gral-stock-alert-7-things-to-know-as-grail-starts-trading-today/.

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