Personalis Shareholders Are Being Offered $16.25 a Share. What They Actually Get Is More Complicated.
Tempus AI is acquiring Personalis. The headline price is $16.25 a share. The deal is valued at roughly $1.5 billion net of Tempus's existing ownership, or about $1.7 billion gross. But that $16.25 is not guaranteed cash. It is primarily Tempus stock — subject to an exchange ratio, a price threshold, and a cash option Tempus controls. What shareholders actually receive will not be clear until closing.
Key Takeaways
- Tempus AI agreed to acquire Personalis for $16.25 per share, but the headline consideration is not a guaranteed all-cash payment. The transaction is structured primarily as a stock deal, with a cash election that Tempus may or may not exercise.
- The maximum exchange ratio is 0.3356 shares of Tempus (TEM) for each PSNL share. The ratio is determined using the Tempus Stock Price specified in the merger agreement — generally a 15-day volume-weighted average price measured shortly before closing.
- At or below the $48.42 threshold, the exchange ratio stays fixed at 0.3356. The value of the stock consideration then moves with the Tempus Stock Price.
- Above $48.42, the ratio adjusts downward so the stock consideration is valued at approximately $16.25 per Personalis share under the merger-agreement formula.
- Tempus has the option — not the obligation — to pay up to 50% of the consideration in cash. If exercised, the cash election is applied pro rata across eligible shareholders, subject to the merger agreement's terms and intended tax treatment.
- Tempus already owns approximately 12.5% of Personalis. Merck Sharp & Dohme owns approximately 13% and has agreed to vote its shares in favor of the merger.
- Personalis was loss-making before the deal, with $69.6 million in revenue, an $81.3 million net loss, and approximately $240 million in cash and short-term investments at year-end 2025.
Short Answer
The $16.25 Personalis offer is not a guaranteed all-cash payment. It is a consideration formula.
Personalis shareholders will receive consideration consisting primarily of Tempus Class A common stock, with Tempus having the option to substitute cash for up to 50% of the outstanding Personalis shares covered by the election. The stock component is determined by an exchange ratio with a maximum of 0.3356 TEM shares per PSNL share.
If the Tempus Stock Price is at or below $48.42, the exchange ratio remains 0.3356, and the value of the stock consideration moves with the Tempus Stock Price. If the Tempus Stock Price is above $48.42, the ratio adjusts downward so that the stock consideration is valued at approximately $16.25 per Personalis share under the merger-agreement formula.
So the real answer to "what does $16.25 actually give you?" is: primarily Tempus shares, with a partial cash component that Tempus may or may not choose to use.
The $16.25 Question
Personalis shareholders are being offered $16.25 a share as part of Tempus AI's agreement to acquire the company.
But $16.25 is not a guaranteed all-cash payment.
Under the merger terms, the consideration is primarily Tempus Class A common stock, with a maximum exchange ratio of 0.3356 TEM shares for each Personalis share. The price that determines whether that ratio adjusts is the Tempus Stock Price — generally defined as the volume-weighted average price of Tempus Class A common stock over the 15 consecutive trading days immediately preceding the last trading day before closing.
If that price is at or below $48.42, the ratio stays fixed at 0.3356, and the value delivered through the stock component moves with the Tempus Stock Price. If it is above $48.42, the ratio adjusts downward so that the stock consideration is valued at approximately $16.25 per Personalis share based on the merger-agreement formula.
Tempus also has the option to elect cash for up to 50% of the outstanding Personalis shares covered by the election, subject to the agreement's provisions, including potential reduction to preserve the intended tax treatment.
That makes the headline number less straightforward than it looks.
The real question for a Personalis shareholder is not simply whether the offer says $16.25. It is: what does that $16.25 actually give you?
The answer depends on the exchange ratio, the Tempus Stock Price, the cash election controlled by Tempus, and the rights shareholders retain before the deal closes.
What Happened
On July 20, 2026, Tempus AI, Inc. (Nasdaq: TEM) and Personalis, Inc. (Nasdaq: PSNL) entered into an agreement under which Tempus will acquire Personalis through a two-step merger.
The transaction uses two Tempus subsidiaries. In the first merger, Aviary Development, Inc. merges into Personalis, with Personalis surviving as a wholly owned subsidiary of Tempus. Immediately afterward, Personalis — as the first surviving company — merges into Toucan Development, LLC, with Toucan surviving as a wholly owned subsidiary of Tempus. In other words, Personalis does not remain as the surviving corporate entity after the full transaction is completed.
The merger agreement is between Tempus, Personalis, Aviary Development and Toucan Development. Eric Lefkofsky is also a filing person in the Schedule 13E-3 transaction statement because of his relationship with Tempus.
Tempus and Personalis filed their transaction materials with the SEC, including a Schedule 13E-3 and the related proxy/prospectus. Those filings are the primary source for the financial mechanics described in this article.
The transaction is expected to close in late 2026 or early 2027, subject to shareholder approval, regulatory approvals and other closing conditions. The shareholder vote date had not been announced in the preliminary transaction materials reviewed for this article.
When the deal was announced, Personalis shares fell about 13% and Tempus shares fell roughly 8%, according to contemporaneous market coverage.
What $16.25 Actually Is
Here is the first thing every Personalis shareholder needs to understand: the headline consideration is not a guaranteed all-cash payment.
The transaction is structured primarily as a stock-for-stock exchange.
The maximum exchange ratio is 0.3356 shares of Tempus Class A common stock for each share of Personalis common stock.
The $16.25 headline consideration corresponds to the maximum 0.3356 exchange ratio at a Tempus Stock Price of $48.42.
That reference price is the pivot point for the stock consideration.
If the Tempus Stock Price is at or below $48.42, the exchange ratio stays at 0.3356. The value of the stock consideration then moves with the Tempus Stock Price. If the Tempus Stock Price is $45, the stock consideration is worth about $15.10 per Personalis share. If it is $40, it is worth about $13.42.
If the Tempus Stock Price is above $48.42, the exchange ratio adjusts downward. The formula becomes $16.25 divided by the Tempus Stock Price. So if the Tempus Stock Price is $60, the ratio drops to about 0.2708 shares — and the stock consideration is valued at approximately $16.25 per Personalis share under the merger-agreement formula.
The transaction documents describe this as a one-way collar mechanism. In plain terms: the exchange ratio is fixed when the Tempus Stock Price is at or below $48.42, so the stock component's value moves with the stock price. When the Tempus Stock Price is above $48.42, the ratio adjusts downward to maintain approximately $16.25 of stock consideration per Personalis share.
That is the core financial reality of this deal. The headline number is a reference point, not a guaranteed all-cash payment.
How the Exchange Ratio and Cash Option Work
There are two additional layers to the consideration that Personalis shareholders need to understand.
The Cash Option
Tempus has the option — not the obligation — to elect cash for up to 50% of the outstanding Personalis shares covered by the cash election.
The decision belongs to Tempus. Shareholders do not individually choose whether their consideration is cash or stock.
If Tempus exercises the election, each eligible shareholder receives cash for the same pro rata percentage of their eligible shares, with the cash portion based on $16.25 per share. The remaining eligible shares receive the stock consideration determined by the exchange-ratio formula.
The cash election is subject to the merger agreement's terms and may be reduced if necessary to preserve the intended tax treatment of the transaction.
If Tempus does not make the cash election, the merger consideration is paid through the stock consideration, together with cash in lieu of any fractional Tempus shares.
The Exchange Ratio Mechanics
The exchange ratio determines how many Tempus shares you receive. It is a formula, not a fixed dollar amount:
- Maximum ratio: 0.3356 Tempus shares per Personalis share.
- Threshold: $48.42 per Tempus share.
- At or below $48.42: Ratio stays at 0.3356. Stock value moves with the Tempus Stock Price.
- Above $48.42: Ratio adjusts downward so the stock consideration is valued at approximately $16.25 per Personalis share.
The Tempus Stock Price is not a single moment's market price. Under the merger agreement, it is generally the volume-weighted average price of Tempus Class A common stock over the 15 consecutive trading days immediately preceding the last trading day before closing. The agreement also contains a separate provision for certain Tempus transactions that could change how that price is determined.
For Personalis shareholders, the practical consequence is this: your consideration is tied to a stock you do not currently own, in a company that is buying yours — and the value of the stock component is determined shortly before closing rather than by the price of TEM on the day the deal was announced.
What Shareholders Could Receive — Scenarios
To make this concrete, here are four illustrative scenarios based on different Tempus Stock Prices. These are not predictions. They are demonstrations of how the stock-consideration mechanism works, before considering any cash election.
The pattern is straightforward: at or below $48.42, the stock component's value moves with the Tempus Stock Price. Above $48.42, the ratio adjusts downward to keep the stock component valued at approximately $16.25.
These examples assume the stated Tempus Stock Price is the applicable price under the merger agreement and illustrate the stock component only. If Tempus makes a cash election, eligible shareholders would receive a corresponding pro rata cash portion in addition to the stock consideration for their remaining shares.
What this means for any individual shareholder depends on the Tempus Stock Price determined under the merger agreement shortly before closing — something that cannot be known today.
Who Already Owns Personalis
Two shareholders already hold significant stakes in Personalis.
Tempus AI beneficially owned approximately 12.5% of Personalis as of the July 2026 ownership disclosure. Tempus purchased 320,267 Personalis shares in open-market transactions between November 18 and December 22, 2025, for approximately $2.74 million.
Tempus is therefore not just the buyer. It is also an existing Personalis shareholder.
Merck Sharp & Dohme LLC beneficially owned approximately 13% of Personalis as of July 20, 2026. Merck entered into a voting agreement committing its shares to be voted in favor of the merger and against competing acquisition proposals covered by the agreement.
Together, the two disclosed holdings represented roughly one-quarter of Personalis's voting power at signing.
| Shareholder | Approx. Stake | Role in Transaction |
|---|---|---|
| Tempus AI, Inc. | ~12.5% | Acquirer; existing shareholder |
| Merck Sharp & Dohme LLC | ~13% | Voting agreement; committed to vote in favor |
| Other shareholders | Remaining shares | Voting and other rights subject to the merger agreement |
The Financial Context
To understand the shape of this deal, you have to look at Personalis's financial position before the acquisition.
According to its fiscal year 2025 annual report:
- Revenue: $69.6 million, down from $84.6 million in 2024.
- Net loss: $81.3 million.
- Cash and short-term investments: approximately $240 million at the end of 2025.
Personalis was generating clinical and other testing revenue, but it was still operating at a substantial net loss.
The company had approximately $240 million in cash and short-term investments at year-end 2025. Its annual report also described liquidity needs and potential sources of funding, including existing cash, cash generated from customers and potential additional financing.
This context is relevant to understanding the financial position from which the transaction emerged. It does not establish why the Personalis Board accepted this particular offer.
What Shareholders Give Up
Beyond the consideration mechanics, Personalis shareholders should understand what rights they retain — and what changes if the transaction closes.
| Right | Status | Notes |
|---|---|---|
| Voting | Retained before closing | Shareholders vote on the merger. Merck has committed its shares to vote in favor. |
| Appraisal rights | Available subject to conditions | Eligible shareholders may have appraisal rights under Delaware law. Merck waived its appraisal rights under the voting agreement. |
| Price-based termination protection | Contractual | Personalis may terminate if the applicable Tempus Stock Price is below $46.00, subject to the agreement's conditions and timing requirements. |
| Equity awards | Handled under merger agreement | Options, RSUs and PSUs receive different treatment depending on their type and status. |
| Post-closing Personalis listing | Ends | Personalis common stock will cease to be publicly traded if the merger closes. |
| Guaranteed $16.25 cash | No | The headline consideration is not a guaranteed all-cash payment. |
Voting: Personalis shareholders will vote on the merger. Merck has contractually committed to vote its shares in favor. Shareholders retain their voting rights before the transaction closes.
Appraisal rights: Eligible shareholders may have the right under Delaware law to seek a judicial determination of the fair value of their shares, subject to the statutory requirements. Merck waived its appraisal rights under its voting agreement. Other shareholders' rights are governed by the applicable Delaware law and transaction documents.
Price-based termination protection: The merger agreement gives Personalis a right to terminate if the Tempus Stock Price, as finally determined under the agreement, is below $46.00 per share. That right is subject to specific contractual conditions and is exercisable only within the period specified by the agreement near closing. It does not guarantee a particular value for shareholders.
Equity awards: The merger agreement provides different treatment for Personalis options, restricted stock units and performance stock units. For example, certain in-the-money options may be converted into Tempus options or stock consideration, while certain out-of-the-money options are cancelled without consideration.
What changes after closing: The first merger makes Personalis a wholly owned Tempus subsidiary, but the second merger immediately follows and causes the first surviving company to merge into Toucan Development. Toucan survives as the wholly owned Tempus subsidiary. Personalis common stock will no longer trade publicly.
What does not change: The headline $16.25 is not a guaranteed all-cash payment. The final stock component depends on the exchange-ratio formula, and the final consideration mix depends in part on whether Tempus exercises its cash election.
Fairness opinions: Centerview Partners and TD Securities provided fairness opinions to the Personalis Board, while Morgan Stanley provided a fairness opinion to the Tempus Board. The opinions are included in the SEC transaction materials but are not analyzed in detail here.
What Remains Unknown
What will the Tempus Stock Price be at closing? Unless a separate Tempus transaction triggers the alternative provision in the merger agreement, it will generally be based on a 15-trading-day VWAP measured shortly before closing. That price is unknowable today.
Will Tempus exercise the cash election? The merger agreement gives Tempus the right — not the obligation — to elect cash for up to 50% of the outstanding Personalis shares covered by the election. Until Tempus makes that election, the final consideration mix remains uncertain.
When will the shareholder vote occur? A special meeting is required, but the vote date was not announced in the preliminary transaction materials reviewed for this article.
What are the precise tax implications? The parties intend the transaction to qualify as a reorganization under Section 368(a) of the Internal Revenue Code. The transaction documents also state that the cash election may be reduced to preserve the intended tax treatment. Individual shareholder tax consequences can differ, so shareholders should consult their own tax advisors.
What will happen to Personalis patients and employees? Tempus has said the transaction will integrate Personalis's MRD technology into its precision-oncology platform. The transaction materials do not establish the precise operational effects on individual patients or employees.
What are the specific allegations of the law firms investigating the deal? Several law firms have announced investigations concerning the transaction and the actions of the Personalis Board. Those announcements represent allegations or inquiries by private law firms, not findings by a court or regulator. They do not by themselves establish wrongdoing.
Bottom Line
The $16.25 Personalis offer is not a guaranteed all-cash payment. It is consideration consisting primarily of Tempus Class A common stock, with Tempus having the option to elect cash for up to 50% of the outstanding Personalis shares covered by the election.
What a Personalis shareholder actually receives will depend on the Tempus Stock Price and the exchange-ratio formula, together with whether Tempus makes a cash election.
At or below $48.42, the exchange ratio stays fixed at 0.3356, and the value of the stock component moves with the Tempus Stock Price. Above $48.42, the ratio adjusts downward so the stock consideration is valued at approximately $16.25 per Personalis share under the merger-agreement formula.
Tempus already owns approximately 12.5% of Personalis. Merck owns approximately 13% and has committed to vote its shares in favor of the merger.
Personalis was loss-making, with approximately $240 million in cash and short-term investments at year-end 2025. That financial position is relevant context for understanding the transaction, though it does not establish why the board accepted this particular offer.
The headline number is $16.25. What that number actually delivers will be determined by a 15-trading-day average, an exchange ratio, and a cash-or-stock decision Tempus controls. That is the mechanism this deal is built on — and the reason the answer to the simplest question shareholders have is still, for now, unknown.
Sources
Primary SEC Filings — Personalis, Inc.
- Schedule 13E-3 — Rule 13e-3 Transaction Statement and transaction materials. View on SEC EDGAR
- Form 8-K — Merger Agreement and transaction terms. View on SEC EDGAR
- Form 10-K — Annual Report for fiscal year 2025. View on SEC EDGAR
- Schedule 13D — Tempus AI ownership disclosure. View on SEC EDGAR
Primary SEC Filings — Tempus AI, Inc.
- Form 8-K — Merger Agreement and consideration mechanics. View on SEC EDGAR
- Form 425 / Transaction Communication — Acquisition terms and transaction overview. View on SEC EDGAR
Company Statements
- Tempus AI — "Tempus to Acquire Personalis." View press release
- Personalis, Inc. — Investor Relations. Visit investor relations
Secondary Reporting
- Nasdaq.com — "Tempus AI To Buy Personalis For $16.25/Share." Read article
- Bloomberg — "Tempus to Buy Cancer-Tech Firm Personalis for $1.7 Billion." Read article
Legal Investigation Announcements
- Wohl & Fruchter LLP — Investigation announcement. View case page
- Brodsky & Smith — Investigation announcement. View announcement
- Ademi LLP — Investigation announcement. View case page
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