The shares of DNA testing provider 23andMe $ME experienced a shocking 59% drop on Monday after the company filed for Chapter 11 bankruptcy protection under the US Bankruptcy Code. This drastic decision follows unsuccessful efforts to find a buyer and the resignation of CEO Anne Wojcicki. 23andMe now plans to sell its assets in a structured auction in hopes of securing the remaining value. The company's management had previously rejected a non-binding takeover offer from Wojcicki, who has been trying to take the company private since April. In recent months, the entire independent board of directors has also resigned, indicating deep-seated differences with Wojcicki. 23andMe's history is also marked by legal issues, including a data breach case in 2023, in which a €30 million settlement was reached with affected customers. Customers in California have been informed that they have the right to have their genetic data deleted from the company's systems, which has further shaken confidence in the brand.
In the USA, the cloud storage provider Dropbox is facing $DBX (+1%) is facing increasing pressure from an activist investor who is questioning the founders' control over the company. According to a report in the Wall Street Journal, Half Moon Capital, a small hedge fund, is criticizing the company's slow revenue growth and payment model strategy. The company plans to reform its dual share structure, which gives CEO and co-founder Drew Houston an outsized voting majority. Half Moon holds approximately 40,000 Dropbox shares, which equates to a value of around 1.1 million euros. A majority vote would be required to pass the proposed amendment, which would require Houston's support as his Class B shares entitle him to approximately 77% of the votes. In a further move, Dropbox has already announced plans to reduce its global workforce by 20%, having already laid off 16% of employees in 2023. These measures show that the company is undergoing a restructuring process to ensure both stability and growth in the future.
Sources:
https://finance.yahoo.com/news/23andme-stock-plunges-following-bankruptcy-ceo-exit-203527004.html
https://finance.yahoo.com/news/dropbox-faces-pressure-activist-investor-204111280.html