Additive manufacturing companies Stratasys and Desktop Metal have announced they have entered into a definitive agreement where the two companies will combine in an all-stock transaction valued at around USD 1.8 billion (AUD 2.77 billion).
According to the firms, the acquisition combines Stratasys’ expertise in polymers with Desktop Metal’s brands’ dominance in industrial mass manufacturing.
In a press release announcing the deal, the companies said the merger is anticipated to create 1.1 billion in revenue by 2025, with “significant upside potential” in a total addressable market of more than 100 billion by 2032.
The agreement, which was unanimously authorised by both companies’ boards of directors, provides Desktop Metal shareholders with 0.123 ordinary shares of Stratasys for each share of Desktop Metal Class A common stock.
Based on the closing price of a Stratasys ordinary share of 15.26 USD on 23 May 2023, this reflects a value of about 1.88 USD (AUD 2.89) per share of Desktop Metal Class A common stock.
Dr Yoav Zeif, CEO of Stratasys, said the day of the agreement’s announcement is “an important day in Stratasys’ evolution.”
“The combination with Desktop Metal will accelerate our growth trajectory by uniting two leaders to create a premier global provider of industrial additive manufacturing solutions,” Zeif noted.
He added, “We look forward to building on the complementary strengths of the combined business and leveraging the strong brand equity across the portfolio to deliver enhanced value to shareholders, customers and employees.”
Meanwhile, Ric Fulop, co-founder, chairman, and CEO of Desktop Metal, expressed his excitement over the agreement, emphasising the company’s portfolio of production metal, sand, ceramic and dental 3D printing solutions complement Stratasys’ polymer offerings.
Together, we will strive to build an even more resilient offering with a diversified customer base across industries and applications in order to drive long-term sustainable growth.
‘We look forward to combining with Stratasys to deliver profitability while driving further innovation for a larger customer base and providing expanded opportunities for our employees,” Fulop stated.
The transaction, which is anticipated to close in the fourth quarter of 2023, will result in existing Stratasys shareholders owning roughly 59 per cent of the combined company and legacy Desktop Metal stockholders owning roughly 41 per cent of the business.
