Is voxeljet looking for a merger?

Voxeljet AG (NASDAQ: VJET), a leading provider of high-speed, large-format 3D printers and on-demand parts services to industrial and commercial customers, may be looking to merge or sell (or possibly even acquire a company) to strengthen its position on the global market.

The company’s Management Board, together with the Supervisory Board (collectively, the Boards), has decided to initiate a formal review process to evaluate strategic alternatives. In furtherance of this objective, voxeljet has engaged BNP Paribas Securities Corp. as financial advisor and Hogan Lovells International LLP as legal advisor to assist in the exploration of strategic alternatives, which may include a full range of strategic, business, and financial alternatives, including, but not limited to, investments, mergers and acquisitions, and joint ventures, strategic partnerships, or other transactions.

Two of the biggest questions in recent additive manufacturing market history concern voxeljet directly. One is, why hasn’t any large company tried to take it over (as far as we know) and the other is why is voxeljet growing at such as slow pace, considering the high quality and potential of its technologies. A third question is why is the company’s stock doing so terribly (as it has for the past several years). This last question, however, is also related to the general dire straits that all pure-player 3D printing companies find themselves in.

We may have some answers to these questions (we have spoken with some of the company’s stockholders and users of its technology during the writing of our recent report on Traditional Ceramics and Sand Additive Manufacturing) and the company’s new openness to evaluating strategic alternatives may help to answer more riddles. One aspect to consider is that we do not know if the company was ever the “object of desire” of larger entities looking to enter the sand or polymer AM market. We do think that the company’s management has never wanted to sell (possibly because they never received a proposal they deemed adequate) and that they are very confident in voxeljet’s long-term potential.

In terms of the company’s slow growth, it has become apparent that voxeljet has never truly invested in aggressive marketing to make its technologies known beyond its current adoption segments. Over the years we have seen dozens of interesting, innovative and high-profile applications created using voxeljet sand 3D printing and polymer investment casting technologies but never a strong enough marketing push to support them. Voxeljet’s latest HSS capabilities may be among the most powerful in the entire polymer AM industry except they are also one of the industry’s best-kept secrets. Not wanting to create hype is understandable, but not wanting to promote a strong (or potentially very strong) product to avoid potential hype is counterproductive. All this may change now, as the management looks for new strategic avenues.

There is no definitive timetable set for the completion of the strategic alternatives review and there can be no assurance that the review process will result in any transaction or any other strategic change or outcome. The Company does not intend to make any further public comment regarding the strategic review unless and until the Boards have approved a specific course of action, or until the Company determines that further disclosure is required by law or otherwise deemed appropriate.