Stratasys H350

Stratasys Will "Engage in Discussions" on Acquisition by 3D Systems

July 17, 2023
The drama in the additive manufacturing world continues, after Stratasys previously rebuffed the offer.

Well, something changed. Stratasys Ltd. officials on Monday said they'd start talking to rival 3D Systems about a possible merger.

That's a far cry from three weeks ago when the company said 3D's bid did "not provide a basis upon which to enter into discussions."

Since, then, the lawyers got involved. The latest round of corporate speak? "After consultation with its financial advisor and outside legal counsel," the bid by 3D Systems "would reasonably be expected to result in a 'Superior Proposal'" to Stratasys' plan to buy another rival additive manufacturing company, Desktop Metal.

If your neck hurts from the whiplash, we understand. A quick review:

  • May 25 - Stratasys, the No. 1 company in additive manufacturing (by 2022 earnings) that specializes in polymer-based 3D printing, announces the intention to buy rival Desktop Metal (guess what material they work in) for $1.8 billion, giving the argument that a combined company can demonstrate large manufacturers to that additive manufacturing can produce at scale.
  • June 2 - 3D Systems, the No. 2 company in additive manufacturing (by 2022 earnings) offers $1.2 billion to purchase Stratasys, stating it would lead to $100 million in savings over time and promised "simply the best outcime for the shareholders of both companies."
  • June 20 - The Stratasys board votes unanimously not to start talks with 3D Systems because the offer does not constitute a "superior proposal" under the terms of the Desktop Metal agreement, because it undervalues Stratasys and doesn't account for 3D Systems's slower growth plans.
  • June 30 - The aforementioned rebuttal by Stratasys, after 3D Systems president and CEO Jeffrey Graves calls the rebuff "perplexing" as Stratasys did not address details of the offer or positive reaction by some investors.
  • Today's news that Stratasys changed its mind and will now take a look at the acquisition bid by 3D Systems.

Does this have to do with statements from Los Angeles-based investment firm The Donerail Group LP, that controls a little more than 2% Of Stratasys' stock, essentially questioning why Stratasys rebuffed the offer from 3D Systems without taking it seriously?

Assessing the proposal requires Stratasys to conduct due diligence on 3D Systems' business and prospects and to negotiate terms with 3D Systems, "subject to the requirements of the Desktop Metal merger agreement."

Meanwhile, the proposal by Nano Dimenstion Ltd. to acquire Stratasys is still dead in the water. Looks like they aren't going to have a seat at this table.

Updates and free neck braces as we have and need them.

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