BRUSSELS (Reuters) -U.S. gene sequencing company Illumina's ( ILMN ) plan to divest cancer diagnostic test maker Grail has received the green light from EU antitrust regulators which blocked the deal two years ago.

Illumina ( ILMN ) jumped the gun in 2021 when it completed the $7.1-billion acquisition before first securing EU regulatory approval.

That prompted the European Commission, which acts as the competition enforcer in the 27-country European Union, to order the company to keep Grail separate from Illumina ( ILMN ).

Its subsequent investigation of the matter resulted in a 432 million euro fine for Illumina ( ILMN ) and an order to sell Grail.

The EU competition watchdog again vetoed the deal in 2022, saying it would stifle innovation and reduce choice in the emerging market for blood-based early cancer detection tests.

"The divestment plan foresees that Illumina ( ILMN ) can select the appropriate divestment method (either via a trade sale or a capital markets transaction)," the Commission said in a statement.

It said the sale would restore Grail's independence and allow it to operate it as a viable and competitive business.

U.S. antitrust regulators had also opposed the deal.

(Writing by Nette Nöstlinger; editing by Charlotte Van Campenhout and Jason Neely)