This year’s corporate acquisition-mania continues, with Desktop Metal announced an acquisition deal for ExOne.
ExOne is one of the older 3D printer manufacturers, having been founded way back in 1995. The company currently offers a line of 3D printers that build objects in sand and metal using binder jet processes. The sand prints are typically used as molds for casting objects with complex geometries, and many ExOne clients use the equipment for production purposes.
The company first became publicly traded in 2013, one of the few at the time. Now, that tradability will conclude as they will be absorbed into Desktop Metal.
Desktop Metal Acquisition of ExOne
The proposal to acquire ExOne by Desktop Metal involves offering existing ExOne shareholders a total of US$192M in cash, as well as US$383M in Desktop Metal stock, with possible adjustments as the company’s share value varies until the closing date, which will be in late 2021. Of course, this is all subject to regulatory approval.
It’s also subject to approval by ExOne shareholders, who will individually be offered the deal by Desktop Metal. They may choose to accept the offer, or not. However, it’s very likely they will accept the deal because the current total value of ExOne is about the same as the Desktop Metal share trade value, with the cash being an extra bonus.
Regarding the acquisition, Desktop Metal CEO Ric Fulop said:
“We are thrilled to bring ExOne into the DM family to create the leading additive manufacturing portfolio for mass production. We believe this acquisition will provide customers with more choice as we leverage our complementary technologies and go-to-market efforts to drive continued growth. This transaction is a big step in delivering on our vision of accelerating the adoption of additive manufacturing 2.0.”
The Expanded Desktop Metal
After Desktop Metal went public last December, they’ve gone on a bit of a buying spree. This was not unexpected, as we are seeing 3D print industry consolidation in general and Fulop himself hinted to us a year ago that there could be some mergers and acquisitions coming, saying:
“One of the things that was really attractive about being a public company is that you have the currency to add value to the industry. We’re going to look at that [M&A] selectively. Our core focus is to grow our business in an organic way, but we will also look at other ways to grow, which are maybe inorganic. We have a lot of potential here. We have our existing suite of technologies, and then there’s also what comes after that.”
That is most definitely what is happening in 2021, as the public company leverage is being exercised to the fullest. This year Desktop Metal has:
- Acquired EnvisionTec
- Announced an unusual wood-based 3D printing process called Forust
- Acquired Aerosint
- Acquired ExOne
Previously the company announced a variety of systems developed internally, such as a continuous carbon fiber system, in addition to their metal production system and initial metal 3D printer, the Studio.
I’m still processing all of these moves and while there’s more to be said, Desktop Metal will soon be a company that offers the ability to 3D print in a very wide variety of materials in multiple processes: metal, sand, thermoplastic, carbon fiber, wood and more.
Sometimes corporate acquisitions occur to consolidate technologies, where the acquired products might be absorbed and fade away in order to focus on one product. I’m not certain that’s happening with Desktop Metal, as the acquired companies seem to be rather complementary in nature, rather than exhibiting any overlap with other Desktop Metal products. There’s also the benefit of accessing an even wider sales force for all these products, as ExOne has a reseller network of their own.
Instead this seems to be a “cover all the bases” strategy, which is no doubt a very good idea. That’s because manufacturing clients these days focus on making things and care less about what specific processes are involved. If your company doesn’t offer the required tech, the customer might go somewhere else for a solution. But with a wide spectrum of possibilities, future Desktop Metal representatives have plenty to offer any client.
I’m extremely interested to see how this move changes things on our 3D print stock market leaderboard, which we update each and every Sunday.
Over the course of this year Desktop Metal has changed significantly — and it’s only August! Fulop and team have plenty of time — and cash — to make additional changes. I’m wondering what will happens next.
Via Desktop Metal