23andMe, the once-high-flying genetic testing company, is at a crossroads. On February 21, 2025, CEO Anne Wojcicki and New Mountain Capital filed a proposal with the U.S. Securities and Exchange Commission (SEC) to take the struggling firm private, offering $2.53 per share in cash—a total equity value of approximately $74.7 million.
With the stock closing at $2.42 that day, reflecting a market cap of $65 million, this move marks the latest chapter in a turbulent year for the company. After losing over 80% of its value in 2024, 23andMe’s leadership is betting on privatization to stabilize its future. Here’s a closer look at the proposal, its context, and what it means for the genetic testing pioneer.
The Offer: A Premium Amid a Storm
Wojcicki, 23andMe’s co-founder, and New Mountain Capital, a New York-based firm managing $55 billion in assets, have teamed up to acquire all outstanding shares of the company. Their $2.53-per-share bid represents a modest 4.5% premium over Friday’s closing price, aiming to deliver “compelling value and immediate liquidity” to shareholders, as stated in a letter to the company’s special committee. This follows a challenging 2024, during which the stock plummeted from its January highs, prompting the company to explore strategic options—ranging from a full sale to restructuring or a business combination.
The proposal arrives after a rejected July offer from Wojcicki alone, which priced shares at just 40 cents—a figure the special committee dismissed for lacking committed financing and failing to offer a premium. This time, with New Mountain’s backing and a promise of secured debt financing to sustain operations through the deal’s closure, the duo aims to address those concerns head-on.
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A Year of Turmoil and Transition
23andMe’s 2024 was marked by volatility. The company, which went public in 2021 via a SPAC merger, valuing it at $3.5 billion, has struggled to maintain momentum. Its core business of at-home DNA testing kits—once a consumer sensation—has faced declining sales, while efforts to pivot into drug development using its genetic database have yet to yield significant revenue. By January 2025, with shares trading well below their IPO price, 23andMe signaled a strategic review to chart an alternative course.
The boardroom has seen its own upheaval. In September 2024, all seven independent directors resigned abruptly, reportedly frustrated with Wojcicki’s earlier privatization efforts. Three new independent directors joined in October, forming a special committee tasked with evaluating the company’s next steps. This committee now holds the key to approving or rejecting the latest proposal, a decision that could redefine 23andMe’s trajectory.
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Wojcicki’s Vision Meets New Mountain’s Muscle
Wojcicki, who retains significant voting power as a co-founder, has long signaled her intent to steer 23andMe away from public market pressures. Her latest effort, bolstered by New Mountain Capital’s financial clout, reflects a belief that privatization could unlock the company’s potential—free from quarterly scrutiny—to focus on its mission of integrating genetics into healthcare. “We believe this proposal offers a clear path forward for shareholders,” Wojcicki and Matthew Holt, New Mountain’s private equity president, wrote in their Thursday letter to the committee.
New Mountain’s involvement adds credibility. With $55 billion in assets under management, the firm brings the resources to stabilize 23andMe’s finances, including a commitment to fund operations through the transaction via secured debt. This contrasts sharply with the financing gaps that sank Wojcicki’s prior bid, signaling a more robust plan to execute the privatization.
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What’s Next for 23andMe?
The special committee’s decision looms large. Charged with safeguarding shareholder interests, it must weigh the $74.7 million offer against other potential paths—whether remaining public or pursuing an alternative deal. The 4.5% premium, while modest, provides immediate cash in a year when 23andMe’s valuation has cratered. Yet, critics may argue it undervalues the company’s vast genetic database, a potential goldmine for future biotech breakthroughs.
For now, 23andMe stands at a pivotal moment. Once a darling of the consumer genetics boom, it now seeks refuge in private hands to rebuild. Will Wojcicki and New Mountain’s vision prevail, or will the committee chart a different course? The answer will shape the future of a company that, despite its struggles, remains a key player in the genetics space. Share your thoughts on 23andMe’s next move in the comments below.
