The terms of the deal have been announced as “a purchase price of $120 million consisting of $110 million in cash and $10 million in Proto Labs stock. RAPID’s 2017 annual revenue is forecasted to be approximately $45 million. The transaction is expected to close by the end of the year, subject to customary closing conditions.”
RAPID is a New Hampshire-based custom parts supplier specializing in quick-turn sheet metal fabrication and CNC machining. The deal adds a further manufacturing service to Proto Labs offerings and expands existing CNC machining capabilities.
The news follows October’s announcement from Materialise who acquired Germany’s ACTech – short run, cast metal part specialists.
Automation driving advanced manufacturing
Jay Jacobs, founder of RAPID said, “Quick-turn prototyping and low-volume manufacturing have always been at the core of RAPID, and this foundation makes us a natural fit with Proto Labs’ digital model.”
“I’m excited about the opportunities our combined manufacturing services will provide for our customers who will now have a single source for a variety of manufacturing services, including injection molding and 3D printing.”
Founded in 2001, RAPID has focused on using automation to provide custom sheet metal parts faster than traditional methods – a strategy that matches well with the approach taken by Maple Plain, Minnesota headquartered Proto Labs.
RAPID now has 140,000 sq. ft. of manufacturing space and employs approximately 300 people. By combining the businesses over 2,000 people will be employed by Proto Labs.
Stock market response to news is positive
Speaking about the acquisition, Vicki Holt, Chief Executive Officer of Proto Labs said, “We listen to our customers very closely to understand their needs.”
“We continue to look for opportunities to expand our capabilities to serve our existing customers and to expand our customer base. RAPID not only adds quick-turn and e-commerce-enabled sheet metal services to our portfolio, it also expands our machining capabilities to support larger and more complex projects. In addition, RAPID’s culture is highly aligned with that of Proto Labs, with a talented and experienced team that we are very excited to welcome to the Proto Labs family.”
Proto Labs latest financial results show revenue from 4 divisions, categorized as Injection Molding, CNC Milling, 3D Printing and Other. At $11.1M 3D Printing comprises 12.6% of total revenue.
CEO Vicki Holt described the results as a “record performance…by many different metrics.”
The stock market response to today’s news was favorable, with a 5% increase in share price at the time of writing.
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Featured image shows a Proto Labs 3D printed demonstrator. Photo by Michael Petch