Markforged announced today that they’ve acquired metal 3D printer manufacturer Digital Metal.
Digital Metal is a very interesting company launched in 2003 by Höganäs AB in Sweden. Höganäs AB is a powder metallurgy company, founded in 1797 — 225 years ago! Today the company produces a variety of high quality metal powders that are used in metal 3D printers worldwide.
The company launched Digital Metal to break into the market to which they supply materials. They correctly saw the eventual transformation of industry towards metal additive manufacturing and evidently wished to ride that wave.
They developed a binder jet solution that is quite unique in the world of metal 3D printing. They are able to 3D print metal objects with truly astounding resolution. We recently covered the company’s new DM PRO 70kp84 metal 3D printer, and looked at the increasingly wide selection of metals that can be used in the system.
Currently, they can print in 316L, 17-4PH, Ti6AI4V, DM 625, DM 247, DM D2, DM 718, DM 4140 and DM Cu. That last one is copper, which is a rare but exceedingly useful material for 3D printing. PBF systems have a great deal of trouble to print copper, yet Digital Metal’s system handles it just fine, as you can see in this 1cm copper print:
That’s what you get from a binder jet system that precisely places 2pl droplets from 70,400 nozzles.
While the Digital Metal systems can 3D print in super-fine resolution, the build volume is not that large at 250 × 217 × 186. As such, Digital Metal has found their niche in smaller precision metal parts, such as watch components, small but complex mechanical parts, and similar.
Now they’re joining the Markforged family.
Markforged, flush with cash from the entry to public trading, decided to acquire Digital Metal likely after seeing their major competitors, Desktop Metal, Stratasys, 3D Systems and others continually scoop up other companies that offered different 3D printing processes. Each of those companies has differentiated their offerings, and Markforged should follow a similar path.
Terms of the deal were a cash payment to Höganäs AB, the owner of Digital Metal, of US$32M, plus 4.1M shares of Markforged. At time of this writing, those shares would be worth approximately US$7.6M, for a total near US$40M. The shares represent approximately two percent of Markforged, so it’s not that Höganäs AB will be a major shareholder when the deal closes later this year.
What will happen next? Markforged CEO Shai Terem said:
“With the Digital Metal acquisition, Markforged is advancing our vision for distributed manufacturing by enabling the reliable, high volume production of precise metal parts at the point of need. Infusing Digital Metal’s solution into The Digital Forge platform allows us to address new applications in the medical, automotive, luxury goods and other industries. The Digital Metal team has created a robust and scalable solution that complements our existing technologies. I look forward to welcoming their talented people to Markforged.”
Digital Metal CEO Christian Lönne added:
“Markforged’s easy-to-use platform, best-in-class software capabilities and material expertise felt like a natural fit for the future of our technology. With Markforged’s experience and go-to-market scale, we are confident that we will be able to grow our technology together and help more manufacturers produce the high-volume metal parts they need to drive highly productive and cost efficient operations.”
My thought is that this arrangement will strongly benefit both companies. For Digital Metal, it’s a huge opportunity to leverage Markforged’s well-established sales and distribution network, which is quite different from that of Höganäs AB. In other words, there will be increased sales, particularly in regions where Digital Metal hasn’t been marketing their equipment.
On the Markforged side, it opens up new opportunities for sales because of the new functionality offered by the Digital Metal equipment, and further diversifies that company’s product portfolio. This adds to their most recent acquisition of Teton Simulation.
Markforged intends on integrating Digital Metal products into the company’s Digital Forge workflow system, which should make operations even easier for Digital Metal clients.
There is no word about facilities or staff changes as a result of the announcement, so one could assume Digital Metal will continue to operate as is, albeit with integrations with Markforged.
It should be interesting how this announcement will be viewed by investors, and we’ll find out in our weekly 3D print company leaderboard analysis on Sunday.