23andMe intertwines with Branson's Virgin Group to go public in $3.5B SPAC deal

23andMe is going public through a $3.5 billion deal spearheaded by Sir Richard Branson’s Virgin Group.

The consumer-focused genetic testing provider will be claimed by a special purpose acquisition company, or SPAC, launched by the multinational conglomerate: the descriptively dubbed VG Acquisition Corp. The cash-and-stock deal is set to close by the end of June, with plans to trade on the New York Stock Exchange under the ticker “ME.”

Branson and 23andMe co-founder and CEO Anne Wojcicki will each put in $25 million, through a $250 million round of private investments in the company’s public equity. When all is said and done, 23andMe expects to emerge with a cash balance approaching $984 million.

"Of the hundreds of companies we reviewed for our SPAC, 23andMe stands head and shoulders above the rest," Branson said. "As an early investor, I have seen 23andMe develop into a company with enormous growth potential.”

Today’s shareholders will end up owning 81% of the new company—which aims to use the proceeds to enter a new phase in its business, focused on providing personalized healthcare and therapeutics based on a person’s DNA, according to Wojcicki.

RELATED: Has home DNA testing hit its high-water mark? 23andMe to lay off 100 as sales turn: CNBC

"We have always believed that healthcare needs to be driven by the consumer, and we have a huge opportunity to help personalize the entire experience at scale, allowing individuals to be more proactive about their health and wellness," she added.

The transaction includes gross proceeds from up to $509 million in cash held by VG Acquisition Corp.—which held its own $480 million IPO last October—plus the $250 million private placement of stock priced at $10 per share, where Branson and Wojcicki will be joined by funds managed by Fidelity, Altimeter Capital, Casdin Capital and Foresite Capital.

RELATED: GlaxoSmithKline makes $300M investment in 23andMe, forms 50-50 R&D pact

23andMe’s therapeutics development enterprise previously inked R&D deals with GlaxoSmithKline, as well as a January 2020 deal with Almirall, which gave the Spanish drugmaker the rights to a bispecific monoclonal antibody with potential in multiple inflammatory and dermatological conditions.