A report from Citigroup on Investors Business Daily declares that HP won’t be buying 3D Systems. Or would they?
As is usual in the corporate world, things are in flux at the top of the 3D printing industry, particularly with 3D Systems, one of the two leading companies in the field, the other being Stratasys.
Recently 3D Systems underwent considerable change in which they axed their entire consumer division, dropped their longtime CEO, frantically reorganized to meet their quarterly result expectations and just recently hired a new CEO to take over from interim leadership.
Their stock price has dropped considerably since the stratospheric heights it - and others in the 3D printing business - hit in early 2014, making the company - and others - more attractive as takeover targets. Why not? The low stock price meant a buyer could take on the company at sale prices.
One possibility for 3D Systems was a takeover by HP, a longtime player in the printing business. HP has shown considerable interest in 3D printing over the years, first by relabeling Stratasys’ uPrint device for a few years. Later, the company announced in a rather strange fashion they intend to enter the 3D printing market with their own equipment.
You might think it would be a natural step for the much larger HP to scoop up 3D Systems to obtain their skills, patents and worldwide distribution networks to leverage with their own product, and even more so when you realize 3D Systems’ new CEO is a longtime former HP executive, Vyomesh Joshi, with significant connections to the company.
Citigroup doesn’t think so. In the report, they say:
We expect Joshi to bring a fresh set of eyes to DDD’s strategic growth and profit initiatives. Investors believe Joshi’s HP roots enhance the possibility of an HP acquisition of DDD. While we see how bullish investors might connect the dots here, (we) believe that an acquisition by HP is highly unlikely.
It could be that HP is so confident in their still-mysterious 3D printing product and process they feel they have no need to dabble with the competition. Perhaps they don’t even see 3D Systems as competition.
But maybe they should: 3D Systems is more than just a 3D printer manufacturer; they produce quite a line of 3D engineering software as well, tools that could well be used with the new HP machinery.
Perhaps HP is waiting for an outcome from 3D Systems’ new CEO to make a decision. It is entirely possible that Joshi can clean up 3D Systems and focus their efforts on tasks to make them a much more powerful and profitable company. Or, it could be that he doesn’t achieve that and then HP might come by to pick up the pieces they’re interested in using.
Either way it should be very interesting to observe.