Renishaw is up for sale.
The UK-based engineering firm is well-known in the 3D print space, and this move could trigger a chain reaction of events in the industry.
While Renishaw produces a line of metal 3D printers, that’s not their prime area of business. The company began in 1973 as an engineering firm focused on measurement tooling. It was quite successful and grew substantially over the years.
Since their inception, the company has grown into a global metrology company, with annual revenues over £500M (US$700M) and 79 offices worldwide. They produce solutions for manufacturing, healthcare, and science applications. Their staff is approximately 4,400, with some 2,500 located in the UK.
In recent years they introduced a line of PBF-process metal 3D printers, currently including the RenAM 500Q and RenAM 500S devices.
Since the 2008 financial troubles, Renishaw has been extremely successful, with their business and stock prices rising steadily.
In spite of that ongoing success, they have suddenly announced they’re up for sale. Why would this happen?
It turns out it has to do with the company’s founders, Sir David McMurtry and John Deer. Both men are at an age when they feel it’s time to retire.
McMurtry, who is the Executive Chairman of Renishaw, said:
“We are both grateful for our continued good health, however we recognise that neither of us is getting any younger. Now finding ourselves in our 80s, our thoughts have increasingly turned to considering the future of our shareholdings in the Company and how we can actively contribute to securing the future success of the business. With that in mind, we approached the rest of the Board to indicate that we felt the time was now right to discuss the best way to achieve this.
As the founders of Renishaw, we understand the importance of Renishaw’s culture, our place in the communities in which we operate, our commitment to research and development, and the loyalty of our staff, our suppliers, and the customers we serve; these together have been the foundation of our success for almost 50 years. With the Board, we are therefore focused on ensuring that we find the right new owner for our business — one who respects and will continue to nurture these important attributes.”
McMurtry and Deer intended to sell their holdings in the company, but the two own 53% of Renishaw stock, and thus their decision is material to the company. Evidently the company’s board considered how to approach the situation and ultimately decided it was in the best interests of everyone to sell the entire company. A formal announcement explained their strategy:
“The Board has considered various options with its advisers. In considering these options the Board, including the Founders, has had regard to the interests of all the Company’s stakeholders. The Board has unanimously concluded that it would be appropriate to investigate the sale of the Company and is therefore launching a formal sale process for the Company.”
Renishaw is now seeking interested parties to contact their agent, UBS, who will interact with them on a non-disclosure basis. Renishaw will then decide which party will be the successful bidder. Whoever it is will have to pony up a great deal of cash for the shares, whose total as of this writing is well over £4.3B (US$6B). Depending on the popularity of the bidding process, that figure could rise, perhaps substantially.
Now the speculation begins. Who will take over Renishaw?
Could it be an existing player in the 3D print space that wants to take over Renishaw? If they do, they’d be getting into far more business than just 3D printing, as Renishaw is mostly a metrology and engineering company.
I think this option is unlikely as I am not sure any of the players have that much cash and the desire to expand into the other lines of business.
Another possibility is a non-3D print company buying Renishaw. This would enable a player to instantly enter the growing additive manufacturing space with proven products and services, particularly in the competitive metal 3D printing market.
I believe this to be a more likely outcome. One obvious possibility is that GE Additive, a company with plenty of financial mojo, could take on Renishaw: they already have acquired two other metal 3D printer companies, so why not one more?
Yet another possibility is a split. Perhaps a large engineering firm takes on the majority of Renishaw assets, and leaves the additive manufacturing piece for another player. This then could be an existing 3D printer manufacturer wishing to expand into the profitable metal market, and it would be much more affordable. This split could also occur after a takeover.
Whichever way it goes, it is sure to shake up the AM industry.