Icahn, Illumina privately discussed settlement before public fight - filing

(Reuters) -Activist investor Carl Icahn and Illumina Inc had weeks-long private negotiations before he started a proxy fight to push the U.S. life sciences firm to unwind its 2021 buyout of Grail, a regulatory filing showed on Thursday.

The billionaire proposed a negotiated settlement on March 8 that included two board seats for his nominees and one for a mutually agreed candidate, according to the filing from Illumina.

He also suggested a joint statement supporting the divestiture of cancer detection test maker Grail if Illumina's appeal to European regulators, which had ordered it to sell Grail, was not successful.

Illumina counter-proposed one seat for an Icahn nominee and another for an independent candidate on its board, but Icahn declined the offer and withdrew his negotiated proposal, according to the company's filing.

Icahn responded on Thursday to the filing, saying in a letter that the company's representatives "have broken their word and gone public and taken out of context certain things that were supposedly said during these discussions."

"The spirit of settlement negotiations is to keep them private in the hopes of achieving peace rather than war."

On March 13, Icahn released a letter to Illumina shareholders, launching the latest in this year's series of high-profile proxy fights and seeking the divestment of Grail as the $7.1 billion acquisition proved costly for investors.

In a recent interview with the Wall Street Journal, Icahn indicated that Illumina should bring former CEO Jay Flatley back.

Illumina's shares closed 1.5% higher at $225.26 in regular trade.

(Reporting by Bhanvi Satija and Raghav Mahobe in Bengaluru and Svea Herbst-Bayliss in New York; Editing by Devika Syamnath)