2023-05-25 08:08:32
CURRENT ADDITION: Stratasys and Desktop Metal have announced a merger.
Stratasys is considering acquiring Desktop Metal. This is reported by the American news agency Bloomberg. Stratasys would take a strategic step to cut off Nano Dimension, which has been fighting a takeover battle for several months. Will a possible takeover of Desktop Metal trigger the necessary consolidation in the sector?
Stratasys has already rejected several takeover offers from Nano Dimension. During an analyst call last week, CEO Yoav Zeif also said the latest offer, $20.05 per share in cash, underestimated Stratasys’ value. The growth prospects of a standalone Stratasys are such that Zeif expects to generate $1 billion in sales in the coming years. In addition, he pointed to the various shareholder lawsuits in which Nano Dimension is involved.
Merger would be worth $1.8 billion
Both companies are trading well below their top stock prices
Now Bloomberg has announced that the Stratasys board is taking another step to shake off the acquirer. It would consider making a bid for Desktop Metal. It currently has a market capitalization of $563 million (as of Bloomberg’s press release). Stratasys’ market capitalization is approximately $1 billion. The price of both is therefore well below their top quotations. Desktop Metal was quoted at more than $30 dollars in early 2021, up from $1.75 yesterday (the price jumped to $2.12 after the plans were announced). Stratasys’ share price has never matched the all-time high of more than $123 set in 2013. The second high in early 2021 was well over $51; yesterday the price closed at $15.26. Bloomberg says Stratasys refuses to comment on the rumours. The combined value of the two companies would be around $1.8 billion. Too big for Nano Dimension, people argue.
From plastics to metal
If the rumor turns out to be true, a 3D printing company with a very broad portfolio will emerge. Stratasys itself worked on the development of metal printing a few years ago. It even showed this on Formnext. But after a new strategic reorientation, polymer technology was chosen, which also fits in with the recently completed acquisition of Covestro AM. With Desktop Metal, Stratasys would still bring metal printing in-house, precisely when the binder technology starts to land in the market. However, Desktop Metal has also acquired plastic printing technology in recent years through the acquisition of EnvisionTec. It will be interesting to see how this business is being integrated into a merged group with the DLP printing technologies from Stratasys and the Origin One. This would give Stratasys a significant market share in the industrial range. Moreover, both players are active in the dental market, in which they see a lot of growth potential.
Consolidation in the sector?
Will this unleash a consolidation in the AM industry? The swung has been out for the last year and a half, especially in terms of sales of new AM systems. Moreover, there are still startups and scaleups that are coming to the attention of the larger parties, as 3D Systems recently showed with the acquisition of Wematter, the Swedish manufacturer of SLS printers. The chance is not excluded that other players will also go on a takeover path under pressure from a broadly positioned Stratasys. The valuations of the AM companies are low. There are certainly opportunities for those who have sufficient cash and are supported by shareholders who invest for the long term.
Photo: In 2018, Stratasys demonstrated metal printing on Formnext. Two years later, the focus shifted to plastics. Will metal printing come back via a detour?
1685034644
#market