In a curious new development of what is evolving into a nail-biting soap opera, Stratasys Ltd., the current market leader in polymer 3D printing solutions, received an unsolicited non-binding indicative proposal from 3D Systems Corporation, the second largest company in AM by revenue, to acquire Stratasys for $7.50 in cash and 1.2507 newly issued shares of common stock of 3D Systems per ordinary share of Stratasys.
Stratasys CEO Yoav Zeiv confirmed to VoxelMatters that the company does recognize the need for consolidation in the AM industry, however, Stratasys’ management seems currently focused on the company’s growth through the planned Desktop Metal merger and by increasing high throughput production capabilities and market reach through consolidation of Desktop Metal capabilities, especially in metal binder jetting and sintering.
As announced on May 25, 2023, Stratasys entered into a merger agreement with Desktop Metal, Inc. (NYSE: DM) (“Desktop Metal”) under which Stratasys and Desktop Metal will combine in an all-stock transaction. The transaction, which is expected to be completed in the fourth quarter of 2023, is subject to customary closing conditions, including the approval of Stratasys’ shareholders and Desktop Metal’s stockholders and the receipt of certain governmental and regulatory approvals.
The Stratasys Board of Directors will carefully review the 3D Systems proposal, in accordance with its fiduciary duties, and its obligations under Stratasys’ merger agreement with Desktop Metal, in consultation with its independent financial and legal advisors. The Stratasys Board has not made any determination as to the 3D Systems proposal within the framework contemplated by the Desktop Metal merger agreement, which remains in effect, nor changed its unanimous approval, recommendation and declaration of the advisability of the agreed transaction with Desktop Metal.
Stratasys shareholders do not need to take any action at this time with respect to the 3D Systems proposal.
On May 30, 2023, Stratasys announced that its Board, after consultation with its independent financial and legal advisors, unanimously determined that the partial tender offer by Nano Dimension Ltd. to acquire ordinary shares of Stratasys for $18.00 per share in cash substantially undervalues the Company and is not in the best interests of Stratasys shareholders. The Board unanimously recommends that shareholders reject the offer and deliver a Notice of Objection.
Combining the $7.50 cash and current value of 3D Systems stock (at closing on June 2nd, 2023) of $8.16, the offer is significantly lower than Nano Dimension’s. However 3D Systems can bring many more consolidated AM technologies to the table and a larger and more established market presence.
J.P. Morgan is acting as exclusive financial advisor to Stratasys, and Meitar Law Offices and Wachtell, Lipton, Rosen & Katz are serving as legal counsel.