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© Reuters. FILE PHOTO: A sign at the front entrance to the global headquarters of Illumina is pictured in San Diego, California, U.S., November 28, 2022. REUTERS/Mike Blake/File Photo

(Reuters) -Illumina said on Sunday that it would divest cancer diagnostic test maker Grail after the companies battled both U.S. and European antitrust enforcers for more than two years and faced fierce opposition from activist investor Carl Icahn.

The divestiture will be executed through a third-party sale or capital markets transaction, San Diego-based Illumina (NASDAQ:) said in a statement, adding that it would finalize the terms by second quarter of 2024.

Grail, valued at $7.1 billion under Illumina’s deal, is seeking to market a blood test that can diagnose many kinds of cancer, known as a liquid biopsy.

The move follows a ruling by the U.S. appeals court on Friday that struck down a Federal Trade Commission (FTC) order against Illumina’s purchase of Grail, a former subsidiary. The court said the agency had applied a wrong legal standard.

The FTC was concerned that Illumina, the dominant provider of DNA sequencing of tumors and cancer cells that help match patients with treatments most likely to benefit them, might raise prices or refuse to sell to Grail’s test rivals.

Europe had proposed measures for Illumina to unwind its acquisition of Grail. Illumina argued that it does no business in Europe and therefore the EU competition enforcer has no jurisdiction.

Illumina’s acquisition of Grail also came under pressure from investors, including billionaire Icahn, who led a successful board challenge in May. Icahn in October sued Illumina, accusing the company of breaching its fiduciary duties in the Grail deal.

Neither Grail nor Icahn immediately responded to Reuters requests for comment.

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