Last week, I allowed myself to make a longer article about the very confusing and already a year long history of Stratasys takeover attempts by Nano Dimension and 3D Systems, with the takeover of Desktop Metal by the former in the background… If anyone is not following this “3D epic”, I encourage you to read the aforementioned text – here we will focus only on its continuation. Because despite the fact that only a week has passed since the last described events, more information has appeared that not only complicates the matter more – if it came true, it would affect the entire additive manufacturing industry in the world…
Well, last week it happened that the upcoming General Meeting of Stratasys Shareholders is to vote for a vote of confidence in the current company authorities, combined with a vote on the simultaneous appointment of completely new authorities, which would come entirely from Nano Dimension. In the meantime, the topic of an arbitration dispute between Stratasys and former shareholders of Origin, which was acquired by Stratasys in 2020, was raised, and with whom the company allegedly does not settle properly. Fortunately, I will not write about this today, focusing on the struggle for power in Stratasys itself.
At the beginning of the week, Nano Dimension made another takeover bid for Stratasys, but this time not all, not half – but 31.9-36.9% of its shares. The offer is the most generous yet, representing an 85% premium over the unchanged 60-day VWAP as of March 3, 2023. Offering $24 per share, this would increase Nano Dimension’s total stake in Stratasys to 46% – 51 %, which would de facto allow for the takeover of power in the company. Given that the company’s current share price is ~$19, that $5 extra may seem tempting to some shareholders.
By the way, it turned out that the concept of voting on the future of the current Stratasys authorities did not come from them at all, but from Nano Dimension, which already has enough influence to put it to the vote at all. This is a very difficult situation for Stratasys, because even if you manage to get out of it unscathed, the difference in votes may be small, which will prove its weakness and will not end the matter at all…
If that wasn’t enough, the statement attached to the last offer included a sentence that could turn the entire 3D printing industry upside down:
Nano Dimension will “support a review of strategic alternatives to further drive shareholder value, including through industry consolidation and possibly through a negotiated merger with 3D Systems, upon successful completion of a special tender.”
Thus, for the first time, the concept of creating a triumvirate straight from ancient Rome appeared, where the power over the entire 3D printing industry would be taken over by three Stratasys – 3D Systems – Nano Dimension, where the mere mention of the latter in this context sounds quite absurd today … However, the matter is quite serious that it was described by one of the largest financial newspapers in the world – the Financial Times. The article includes a statement by an anonymous banker who is involved in the ongoing discussions on this subject, who stated – “everyone agrees on one thing: consolidation should take place. The three companies (Stratasys, 3D Systems, Nano) should be together, and the question is: what is the order of operations?”
Taking into account all the information, industry knowledge and influence of Stratasys and 3D Systems on the global 3D printing market, it can be said that this would turn everything upside down in terms of local (national) distribution chains, availability of technological solutions and potential reactions of competitors (starting with GE, HP, SLM / Nikon, to EOS, Farsoon or TRUMPF). When we add to this the unpredictability and controversy of Yoav Stern – the president of Nano Dimension, we are dealing with a truly explosive mixture.
This is how it looks now:
If such a merger were to take place, it would first affect the local distributors of Stratasys and 3D Systems 3D printers, which until now competed with each other on technologies, and now would have to start working together under one brand. Or – as was the case after the merger of Ultimaker with MakerBot, the existing distributors of one brand would cease to be them in favor of someone else? Secondly, it would lead to a major reshuffling of the industrial 3D printer market – GE, HP and Nikon might see a potential threat here, or some other industrial giant would decide it’s the right time to go shopping and grab “what else is on the market” left.”
The matter is so difficult for Stratasys that today it has issued a long – and quite “personal” letter to shareholders in which it “urges” them not to take the latest Nano Dimension offer seriously under any circumstances, because it will be very bad … You can read the letter here, I’ll just give you some most interesting “information”:
“We firmly believe that Nano Dimension Ltd.’s highly opportunistic, self-serving campaign to take control of Stratasys puts your investment at risk, threatening to derail our significant progress, dismantle Stratasys’ proposed combination with Desktop Metal and destroy Stratasys shareholder value. (…)
Phew…
So far, all of Stratasys’ statements to shareholders on this matter have been very diplomatic and businesslike. This time you can see that the company is a bit against the wall and refers to stories that happened several years ago… These are certainly very interesting and plausible stories, but the nature of this letter is completely different from everything that has been announced before.
In just a few weeks there will be a great confrontation. I’m more than sure something else will happen in the meantime…
Source: www.businesswire.com & www.tctmagazine.com