23andMe Confirms Merger with SPAC VG Acquisition Corp. (VGAC)

February 4, 2021 7:07 AM EST

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23andMe, Inc., a leading consumer genetics and research company, and VG Acquisition Corp. (NYSE: VGAC), a special purpose acquisition company sponsored by Virgin Group, announced today that they have entered into a definitive merger agreement. Upon completion of the transaction, estimated in the second calendar quarter of 2021, VGAC will change its New York Stock Exchange (NYSE) ticker symbol, and the combined company's securities will trade under the ticker symbol "ME".

23andMe Overview

23andMe's mission is to help people access, understand and benefit from the human genome. The company pioneered direct-to-consumer genetic testing, giving consumers unique, personalized information about their genetic health risks, ancestry and traits. 23andMe is the only consumer genetic testing company with multiple FDA clearances for over-the-counter health and carrier status reports. The company is dedicated to empowering its customers with information they can use to make better decisions about their healthcare, helping them to live healthier lives.

23andMe offers its customers the option to participate in genetic research. To date, more than 80% of customers have chosen to participate. This participation, which has helped create a premier re-contactable database for genetic research, enables 23andMe to analyze genotypic and phenotypic data and to discover new genetic insights. These insights unlock future opportunities across health, therapeutics and other areas. 23andMe's dedicated therapeutics group leverages the company's research platform to help discover novel treatments for patients with serious unmet medical needs. The company has generated a broad pipeline of more than 30 therapeutic programs, spanning oncology, respiratory, cardiovascular diseases and more.

"As a fellow industry disruptor as well as early investor in 23andMe, we are thrilled to partner with Sir Richard Branson and VG Acquisition Corp. as we approach the next phase of our business, which will create new opportunities to revolutionize personalized healthcare and medicine," said Anne Wojcicki, CEO and Co-Founder of 23andMe. "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. Through a genetics-based approach, we fundamentally believe we can transform the continuum of healthcare."

"Of the hundreds of companies we reviewed for our SPAC, 23andMe stands head and shoulders above the rest," said Sir Richard Branson, Virgin Group Founder. "As an early investor, I have seen 23andMe develop into a company with enormous growth potential. Driven by Anne's vision to empower consumers, and with our support, I'm excited to see 23andMe make a positive difference to many more people's lives."

Key Transaction Terms

On February 4, 2021, VG Acquisition Corp. (NYSE: VGAC) entered into a definitive agreement to combine with 23andMe through a combination of stock and cash financing. The business combination values 23andMe at an enterprise value of approximately $3.5 billion.

The transaction is expected to deliver up to $759 million of gross proceeds through the contribution of up to $509 million of cash held in VG Acquisition Corp.'s trust account and a concurrent $250 million private placement (PIPE) of common stock, priced at $10.00 per share. Sir Richard Branson, Founder of the Virgin Group, and Anne Wojcicki, CEO and Co-Founder of 23andMe, are each investing $25 million in the PIPE and are joined by leading institutional investors, including funds managed by Fidelity Management & Research Company LLC, Altimeter Capital, Casdin Capital and Foresite Capital.

As part of the transaction, 23andMe's existing equity holders will roll 100% of their equity into the combined company. Assuming no public shareholders of VG Acquisition Corp. exercise their redemption rights, 23andMe will be capitalized with up to $984 million in cash to fund operations and support new and existing growth initiatives.

The transaction, which has been unanimously approved by the Boards of Directors of each of 23andMe and VG Acquisition Corp., is subject to approval by VG Acquisition Corp.'s shareholders and other customary closing conditions. The transaction is expected to close in the second calendar quarter of 2021.

A more detailed description of the transaction terms and a copy of the Agreement and Plan of Merger will be included in a current report on Form 8-K to be filed by VG Acquisition Corp. with the United States Securities and Exchange Commission (the "SEC"). VG Acquisition Corp. will file a registration statement (which will contain a proxy statement/prospectus) with the SEC in connection with the transaction.

Advisors

Citi is serving as lead financial advisor, capital markets advisor and placement agent to 23andMe. Morgan, Lewis & Bockius LLP is serving as legal counsel to 23andMe.

Credit Suisse acted as lead financial advisor, capital markets advisor and placement agent to VG Acquisition Corp. LionTree Advisors acted as financial advisor and Davis Polk & Wardwell LLP is serving as legal counsel to VG Acquisition Corp.

Investor Management Presentation

23andMe and VG Acquisition Corp. management will host a conference call on February 4, 2021 at 8:00 am ET to review an investor presentation. The conference call can be accessed at https://mediacenter.23andme.com/company/investors/. A recording of the webcast will be available online following the conference call, through VG Acquisition Corp. at https://vgacquisition.com/investor-relations/ and 23andMe at https://mediacenter.23andme.com/company/investors/. The presentation will also be filed with the SEC by VG Acquisition Corp. as an exhibit to a Current Report on Form 8-K, which can be viewed on the SEC's website at www.sec.gov.



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