In an electrifying development for the 3D printing industry, Stratasys Ltd and Desktop Metal Inc have announced a definitive agreement to merge their companies in an all-stock transaction valued at approximately $1.8 billion. This merger, a landmark moment for the additive manufacturing industry, will combine Stratasys’ polymer strengths with Desktop Metal’s industrial mass production leadership, creating a robust balance sheet for a future-oriented combined company.
With Desktop Metal, a recognized leader in manufacturing for mass production, and Stratasys, a dominant player in the 3D printing solutions space, the merger is set to create a combined business powerhouse. Connecting these two recognizable brands will cater to the entire manufacturing lifecycle and promises to usher in the next phase of additive manufacturing, driving long-term sustainable growth.
The merger brings together two of the fastest-growing segments in additive manufacturing, promising an expanded portfolio of production metal and polymer offerings to a more extensive customer base across industries. The synergy between the two companies extends beyond their complementary product offerings. Together, they will house one of the industry’s largest and most experienced R&D teams, boasting over 800 scientists and engineers. This merger will drive future growth initiatives and enhance customer support capabilities.
The all-stock deal, which will see Desktop Metal Class A common stock exchanged for ordinary shares of Stratasys, has been designed to offer an upside potential to both sets of shareholders. Notably, the transaction is subject to the approval of Stratasys’ shareholders and Desktop Metal’s stockholders, customary closing conditions, and certain governmental and regulatory approvals.
The combined company is forecasted to generate $1.1 billion in 2025 revenue, potentially addressing an addressable market of more than $100 billion by 2032. With the complementary strengths of both businesses, there are significant opportunities for growth and improvements in operational processes. The company will also benefit from a diversified customer base, additional annual run-rate cost synergies, and a well-capitalized balance sheet.
The merger is expected to offer significant benefits to industrial customers. The combined entity will provide outstanding customer service by blending Stratasys’ expertise in polymers and Desktop Metal’s leadership in industrial additive manufacturing. The companies’ complementary IP and complementary portfolios of additive manufacturing platforms will enhance the resilience of their offering and increase their market infrastructure.
However, amidst the excitement of the merger, Stratasys has also been approached by Nano Dimension and 3D Systems with unsolicited proposals. These proposals, offering control premiums over the closing price of Stratasys’ ordinary shares, are under careful consideration by the board of directors. The board will examine these proposals in light of their existing merger agreement with Desktop Metal and their duty to deliver long-term value to their shareholders.
As the additive manufacturing industry awaits the final decision, one thing is clear – the merger marks a new era for 3D printing companies. Whether it’s the Stratasys and Desktop Metal merger or an unexpected turn with Nano Dimension or 3D Systems, the future of manufacturing is about to take a significant leap forward.
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Stratasys & Desktop Metal: A $1.8B Mega Merger
