Stratasys, an Israeli 3D printing firm, said that it received a counterbid by US rival 3D Systems following a merger agreement of $1.8 billion with Desktop Metal.
3D Systems, as part of a cash merger offer announced on Friday offers to purchase each Stratasys common share for $7.50 cash and 1.2507 newly issued shares. 3D Systems stated in a release that this would equal about $25 for each Stratasys shares. Stratasys stock rose 11% Friday to $16.21.
Stratasys’ shareholders will own 40% of 3D Systems and receive $540 million cash as a result of the merger.
Stratasys (Nasdaq) is a manufacturer of industrial 3D printing systems for polymer production. The company has offices in Rehovot as well as Minnesota. They operate in various industries, including consumer products, healthcare and aerospace, and in the automotive industry. The firm’s clients include General Motors, Google, Tesla, Amazon, and Medtronic.
According to Grand View Research’s 2022 report, the global market for 3D printing, also known as additive manufacturing, is expected to reach $76 billion in 2030.
“We are at an inflection point in our industry, and we see significant upside for our shareholders and all stakeholders by capturing the benefits of scale, enhancing investment in innovation and delivering long-term profitable growth,” said 3D Systems resident and CEO Jeffrey Graves.
3D Systems expects to achieve cost synergies of $100 million as a result a possible combination of both firms. In 2024, combined revenue would be $1.3 billion, making it the largest pure-play additive manufacturer in the industry.
3D Systems enters the race for Israel’s 3D-printing company after Stratasys, on May 25, announced a merger with US firm Desktop Metal. The deal was valued at $1.8billion. Desktop Metal designs 3D systems for printing metal, polymer and ceramics such as sand.
Combining Stratasys & Desktop Metal should generate $1.1billion in revenue by the year 2025. This will create a dominant company in a fragmented 3D printing industry that is expected grow to $100billion by 2032.
Stratasys said its board of directors will “carefully review” the proposal by 3D Systems, as the merger deal with Desktop Metal is still subject to certain conditions, including the approval of both Stratasys’s and Desktop Metal’s shareholders, as well as governmental and regulatory authorities.
Stratasys’ board unanimously rejected a bid for takeover by Nano Dimension last week. The $18 per share cash offer “substantially undervalues the company and is not in the best interests of shareholders,” Stratasys said.
At the end of May, Israel’s XJet, which develops inkjet technology for 3D-printing of small metal and ceramic parts, announced that it was seeking to raise about $10 million from an initial public offering (IPO) of shares on the Nasdaq.