Private Equity Meets Both Privacy Concerns and Major Growth in Next-Generation Industry. 

The PE space is buzzing over private equity giant Blackstone’s acquisition of DNA testing company Ancestry.  The firm now holds a majority of the company following a $4.7 billion dollar buyout. 

This is a unique acquisition due to the nature of Ancestry.  People use Ancestry to take DNA tests, and Blackstone’s ownership shows how people do not know exactly what companies have a hold of their private information.  

According to Blackstone, Ancestry makes $1 billion dollars annually from tests and a $50 dollar monthly subscription service allowing users to create a family tree.  Clearly, Ancestry’s cash flow is an attractive asset to Blackstone.  In a statement, Blackstone managing director Sachin Bavishi stated “Ancestry’s large network of highly engaged users, unique content, and scaled technology platform have made it a market leader…We look forward to contributing Blackstone’s resources and leveraging our strong expertise in digital content to further accelerate Ancestry’s growth.”

Some industry observers contend that customers should caution when giving their genetic information to companies like Ancestry.  Ancestry’s partnership with Blackstone illustrates how people’s genetic data is freely moved among businesses and corporations.  Corporations should also be careful and mindful of the information they acquire.  Each time a new party is involved,  customers’ privacy risks are increased.

While these cautionary matters highlight the intersection of private equity and privacy concerns inherent in acquired assets, the Blackstone purchase sets the stage for major developments likely to come in the DNA testing space in the months and years ahead.