Tempus AI (NASDAQ:TEM) will acquire Personalis (NASDAQ:PNSL) in a stock deal valued at $1.5 billion, expanding its reach in the market for tests that monitor cancer recurrence after treatment.
Personalis shareholders will receive $16.25 per share, a 6% premium to Friday's closing price and a 28% premium to the unaffected 30-day volume-weighted average price.
The deal is structured as an all-stock transaction, though Tempus has the option to pay up to 50% of the consideration in cash, with a maximum exchange ratio of 0.3356 Tempus shares for each Personalis share.
Shares of Tempus fell more than 8% Monday, while Personalis dropped 11.5%.
The acquisition builds on a partnership the companies established in November 2023, when Tempus invested in Personalis and began commercializing its NeXT Personal minimal residual disease (MRD) test.
Personalis' technology, which tracks circulating tumor DNA to detect cancer recurrence and monitor treatment response, has Medicare coverage in three indications.
"MRD is a large and rapidly growing market with the potential to truly transform how cancer patients are monitored, helping clinicians make faster and more informed decisions when cancer recurs," said Eric Lefkofsky, CEO of Tempus.
Personalis reported preliminary second-quarter revenue of $22.4 million, with 10,384 clinical tests delivered in the quarter, a 33% increase in volumes from the prior quarter.
The deal, approved by both companies' boards, is expected to close in late 2026 or early 2027, pending Personalis shareholder approval and regulatory clearance.