Illumina: Completes Spinoff of Grail to Shareholders

Illumina has completed its planned spin off of Grail directly to shareholders, with trading starting on June 25. As highlighted when this announcement was made in early June, we have reduced our fair value estimate on Illumina to $188 per share, which includes $180 of value on the firm's core sequencing business plus about $8 of value on Illumina’s remaining 14.5% stake in Grail, down from a total valuation of $228 previously. With this divestiture, Illumina is now focused on its narrow-moat sequencing business, which has intangible asset and switching cost moat sources.