The 3D Systems and Stratasys merger has not taken the step forward anticipated today.
Anticipation that the conclusion of a deal would come with the publication of financial results for both 3D Systems and Stratasys did not materialize.
“While we had hoped to be in a position to announce a deal with Stratasys today, we’re not in a position to do so. However, the end of the process is in sight. We will see it through to its ultimate conclusion,” said Dr. Jeffrey Graves, President and CEO of 3D Systems on a call with investors.
“Candidly, we expected this transaction to be announced by now and are frustrated by the pace and the lack of any engagement on the merger agreement we delivered to Stratasys signed in escrow on July 13. We remain committed to pursuing this powerful combination for the benefit of our collective shareholders, but can only conclude the merger if Stratasys shares our commitment,” said Dr. Graves.
“This combination presents unmatched value creation for all stakeholders in the additive manufacturing industry, creating a leader in the industry with an exceptional financial profile that will provide three critical elements to all stakeholders: sustainable profitability, innovation, and value,” added the 3D Systems CEO.
Nano Dimension withdrew its plan to take over Stratasys, leaving only Desktop Metal as the fourth company in this long-running business combination. As recently as this week, Desktop Metal expected the deal to close, detailing the benefits during a call with investors to discuss Q2 2023 financial results. 3D Systems had previously stated a commitment to paying a termination fee due to Ric Fulop’s company should the merger of Desktop Metal and Stratasys fail to proceed.
“Our 3D printing industry today remains highly fragmented and, until this is rectified, all companies will be exposed to similar volatility over time,” said Graves.
“At 3D Systems, we see two distinct paths to achieving scale. The first is an immediate step-function change through our proposed combination with Stratasys, which has the added benefits of significant short-term cost synergies and an outstanding breadth of combined technology platforms for sustained, long-term growth. The second path is to attain scale organically, leveraging our current metal and polymer technology portfolio, which is the broadest in the industry, and our groundbreaking development efforts in regenerative medicine, which you will hear much more about over time. Either path can be successful, but the combination with Stratasys clearly accelerates the benefits to our customers and shareholders, which is why we have been working on this concept for the last two years, and so passionately over the last two months,” added the 3D Systems CEO.
Stratasys also published financial results today. CEO Yoav Zeif used the quarterly update to comment on the ongoing merger activity surrounding the company. “I would like to thank our employees who have continued to maintain their focus, furthering the execution of our strategy with excellence and helping to make Stratasys the healthiest and strongest-growing business in our industry. Despite the various M&A scenarios emerging in the industry, customers across all of our technologies remain highly engaged and confident in Stratasys as we continue to look for ways to expand our innovation and suite of offerings. The addition of Covestro’s Additive Manufacturing business has yielded immediate results, and our expected combination with Desktop Metal will create comprehensive offerings across the industrial landscape. Additive manufacturing is on the edge of tremendous growth as customers accelerate the use of our technologies at production scale. Together with our fortress balance sheet and resilient business model, we are well-positioned to drive profitable growth as we continue to create shareholder value.”
On August 8th Stratasys announced that its shareholders had voted to re-elect all eight director nominees: S. Scott Crump; John J. McEleney; Dov Ofer; Ziva Patir; David Reis; Michael Schoellhorn; Yair Seroussi, and Adina Shorr.
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