23andMe (ME) files for bankruptcy, CEO and co-founder Wojcicki resigns. (00:21) James Hardie Industries (JHX) to acquire AZEK for $8.75B in cash, stock. (01:56) Korean AI chip startup FuriosaAI rejects Meta’s (META) $800 million offer - report. (02:24)Episode transcripts seekingalpha.com/wsb.Show links: Biggest stock movers Monday: TSLA, SMCI, and moreInternational names dominate list of cheap stocks with strong momentumAI boom echoes dot-com bubble, but with key differences: BloombergLuxury cars face biggest challenges from Trump's tariffs, WSJ reportsSign up for our daily newsletter here and for full access to analyst ratings, stock quant scores, dividend grades, subscribe to Seeking Alpha Premium at seekingalpha.com/subscriptions.
Chapter 1: Why did 23andMe file for bankruptcy?
Welcome to Seeking Alpha's Wall Street Breakfast, where we cover the top news for investors every morning. Good morning. Today is Monday, March 24th. I'm Julie Morgan. 23andMe files for bankruptcy. James Hardy is expanding and Meta Platforms is rejected. 23andMe has filed for bankruptcy protection. The company was once worth $6 billion after its SPAC merger in 2021.
Chapter 2: What challenges did 23andMe face leading to bankruptcy?
It has a current market valuation of just under $50 million. Its CEO and co-founder, Ann Wojcicki, also resigned. 23andMe promised to revolutionize the healthcare industry with its affordable DNA tests, which detailed genetic lineage and was set to develop drugs that were tailored from the company's research. The biggest issue facing the company is that it has never reported a net profit.
No successful follow-up products or subscriptions were developed with its pharma partner, GSK, and the therapeutics development team was slashed in half by mid-2023 as interest rates rose and funding dried up. A massive data breach later that year also exposed the profile information of 6.9 million users, nearly half of 23andMe's reported customers.
Chapter 3: What are the future plans for 23andMe after the CEO's resignation?
Last November, the company cut its workforce by 40% and stopped the development of all its therapies. While Wojcicki has explored strategic alternatives, including attempts to take the company private, her bids were rejected by 23andMe's board. She's now out as CEO, but hopes the move will put her in the best position to pursue the company as an independent bidder.
In the meantime, 23andMe has secured up to $35 million in debtor in possession financing to support ongoing operations, with its CFO serving as interim CEO. James Hardy Industries has agreed to acquire outdoor living products maker AZEC. The cash and stock deal is valued at $8.75 million.
Chapter 4: What is the significance of James Hardie's acquisition of AZEK?
In a joint statement, the company said AZEC shareholders would receive $26.45 in cash and 1.034 ordinary shares of James Hardy for each AZEC common share they own. The deal is expected to close in the second half of the year. Korean chip startup Furiosa AI has rejected an $800 million takeover offer from Meta Platforms.
Chapter 5: Why did Furiosa AI reject Meta's takeover offer?
Bloomberg reported citing a person with knowledge of the matter that Meta had been in discussions about acquiring sole-based Furiosa AI since the start of this year. The company develops semiconductors for AI inferencing or services. The report said Furiosa plans to raise capital before eventually pursuing an initial public offering.
Its latest chip known as Renegade is built on Taiwan Semiconductor Manufacturing's 5-nanometer process and uses HBM3 memory chips supplied by SK Hynix. Renegade is reportedly designed to challenge products from industry leader NVIDIA, as well as fellow startups Grok, Samba Nova Systems, and Cerebra Systems. Now let's take a look at what's trending on Seeking Alpha at this early hour.
International names dominate the list of cheap stocks with strong momentum. Bloomberg says the AI boom echoes the dot-com bubble, but with key differences. And the Wall Street Journal reports that luxury cars face the biggest challenges from Trump's tariffs.
On our Catalyst Watch for the Day, DoorDash, William Sonoma, Expand Energy, and TKO Group officially joined the S&P 500 Index to replace BorgWarner, Teleflex, Celanese, and FMC. Now for a look at the markets ahead of the opening bell. Dow S&P and Nasdaq futures are in the green. Crude oil is flat at $68 a barrel. Bitcoin is up 3.5% at $87,000.
In the world markets, the FTSE 100 is up 0.2% and the DAX is up 0.8%. Riot Platforms is on our list of the biggest movers of the day pre-market. Riot is up 4% after the company signed a term sheet for the potential acquisition of select Rhodium Encore assets at its Rockdale facility through its affiliate, Windstone US.
On today's economic calendar, at 8.30 a.m., the Chicago Fed National Activity Index. That's it for today's Wall Street Breakfast. Thanks for listening. To take full advantage of Seeking Alpha with coverage on significant stocks and ETFs, become a premium subscriber. Check out seekingalpha.com slash subscriptions. I'm your host, Julie Morgan. Go out and make it a great day.
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