3D Printing

Arcam AB Acquires Materials Division of Raymor

Perhaps as a means of directly controlling its metal powders supplier, 3D metal printer manufacturer Arcam AB (AMAVF, in the US, or ARCM.ST on the Nasdaq OMX) has signed an agreement to acquire the AP&C division of Raymor Industries for 35 million Canadian dollars.  AP&C, which manufacturers metal powders using proprietary Plasma Atomization technology, has been supplying Arcam with titanium powder, vital to Arcam’s business, for the past seven years.

The purchase, paid for with Arcam’s funds and additional loans, will take place in two installments in 2015 and 2016.  According to Arcam, the newly acquired division is set “to generate CAD 6.5 M of revenue during 2013 with an EBITDA result of about CAD 1.5 M.”  AP&C will become a subsidiary of Arcam, maintaining its existing management team, in the first quarter of 2014. The deal may make it possible for Arcam to issue 400,000 new shares.

Through the purchase of AP&C, Arcam plans to continue developing its powder business, as well as push the Plasma Atomization technology further, with the CEO of Arcam, Magnus René, saying, “With this acquisition Arcam secures access to the optimum production of high grade metal powders for our customers and we also add technology and expertise in powder metal production for 3D printing in general and other advanced applications. This acquisition is consistent with our growth strategy, complements our technology and product portfolio, and is immediately accretive. We are very pleased to welcome the skilled team at AP&C to the Arcam group.” Jacques Mallette, President of Raymor Industries and future President of Arcam’s powder subsidiary, believes that the division’s previous relationship with Arcam will help the company to grow 3D printing as a whole.

Although the acquisition may aid Arcam in its position in the 3D metal printing market, Steve Heller at the Motley Fool, suggests that the firm may be running on investment dollars, rather than profits, having only sold four of its machines in the third quarter of this year. He points out that the new materials position could, however, allow it to grow into a much larger company.

Source: Global Newswire