Theranos is indulging into some deft maneuvering in order to cope with the issues it has been facing of late. As per the latest news which has made its way to us, the company has offered to double investor shares, if they promise not to sue the company. The news comes even as Theranos attempts to solve legal and financial difficulties and pivot into a different niche that lays greater focus upon its mini-labs.
At least some of the extra share is coming from none other than the company’s founder Elizabeth Holmes. The company’s board approved the move to shuffle stock, including some of Holmes own to investors, back in February. This is an intriguing and rather unprecedented development from a company that at its peak, was valued in the billions and was a Silicon valley success story.
Following allegation regarding the tech the company was deploying, a significant number of Theranos’s labs were closed — leading to a pivot in a different direction. All this is of course, not very conducive for investor trust considering that it is their own money they have been watching sink all this time. This latest move could allow Theranos to gain further leeway as it attempts to get its business back on track.
This new deal will include investors who participated in Theranos’ latest funding round in 2015, which saw the company raise $600 million. Investors like BlueCross BlueShield Venture Partners, Continental Properties Co., Esoom (Enterprise of Taiwan), Jupiter Partners, Palmieri Trust, Dixon Doll, Ray Bingham and B.J. Cassin, will all receive twice the shares for each share they purchased in that round.
While most investors have taken the agreement, at least a couple haven’t. Media Mogul Rupert Murdoch has arrived at a separate arrangement with Theranos under which it is buying all his shares at $1 apiece. Meanwhile, San Francisco-based hedge fund Partner Fund Management LP has also refused to be privy to this particular arrangement.
