Stratasys Talks The State of the Company and its Negotiations with Nano Dimension and 3D Systems

Published on June 21, 2023 by Madeleine P.
Stratasys CEO

As we see more and more, the 3D printing market is continuing to move towards consolidation. In fact, a few weeks ago came a piece of news that caught the attention of the entire additive manufacturing sector. It was the upcoming union of Stratasys with Desktop Metal, two major manufacturers of industrial 3D printing solutions. But that was not all, not long before this announcement, we had learned of Nano Dimension’s own interest in acquiring the Stratasys ecosystem. Moreover, a few days after learning of the intended deal with DM, 3D Systems’ move to launch a takeover bid for the Israeli manufacturer was also announced. To learn more about the situation, we headed straight to the source. To do so, we spoke with the company’s CEO, Yoav Zeif. He explained in detail Stratasys’ strategy, as well as the current status of talks with other players in the sector.

3DN: Could you introduce yourself and tell us about the current situation with Stratasys?

My name is Yoav Zeif and I joined as Stratasys CEO in the middle of the pandemic in 2020. It was at that time that we set our strategy as a company, focusing first on leading in polymer manufacturing and working to provide complete solutions for the most compelling use cases for additive manufacturing. This strategy has been going really well. We’ve launched a number of new offerings for FDM and PolyJet, we’ve added three additional technologies so we can serve a much broader addressable market, we’ve adopted a common and open software strategy and a hybrid material strategy that’s right for manufacturing.  Now it’s time to take the next step.

On the left, Yoav Zeif, CEO of Stratasys, in an interview with the 3Dnatives team.

3DN: Why did you decide to take the step to combine with Desktop Metal?

Our goal is to create a next-generation additive manufacturing company that can deliver a full set of solutions from design to production, across a wide range of materials, including polymer, metal, sand, and ceramic. That means more value for our customers. As we re-established clear leadership in the industrial polymer space, metal has always been the next step, so we started having some pretty substantive conversions beginning at RAPID+TCT last year. And quite simply, with their binder jet technology, Desktop Metal has the best production-scale metal 3D printing technology on the market.

Desktop Metal has assembled a wide range of solutions that are very complementary to our own, with little overlap. Sand casting is exciting, dental solutions are strong, they basically created the DLP category, and they have one of the largest R&D and engineering teams in the industry, with ties to MIT. I believe our customers are going to respond really well to Desktop Metal’s solutions given our track record for quality, for great service and support, coming from a stable and profitable company and a large global partner network.

3DN: What impact will this new union have on the AM market?

I am confident we will continue to see plenty of innovative startups in additive manufacturing.  But 3D-printed parts today represent less than 0.1% of the manufacturing industry total despite well-documented benefits for many applications. This is despite so many potential benefits like mass personalization and lower cost per part for short-to-medium run production and supply chain flexibility. We’re ready to bring these benefits to the broader market and we believe this combination will significantly expand our ability to do so.

Through the union of Stratasys and Desktop Metal, the two companies hope to “reshape the additive manufacturing industry.”

Stratasys is already seeing growing adoption of these manufacturing applications by our customers. These represent many of the largest companies like GM and Boeing, but also rapidly emerging players like Tesla and Boom Supersonic. They look to us for the full solution. They are benefiting from our huge commitment to product quality, a common software platform across the technologies, and open materials options designed with manufacturing needs in mind. I believe that these are the ingredients that really, along with innovative technology and deep industry expertise, that will continue the rapid growth of additive manufacturing applications. They’re not looking to fail fast but to scale confidently, and they’re seeing that when they add Stratasys solutions to the mix, we deliver.

3DN: We have also learned of 3D Systems and Nano Dimension’s interest in Stratasys, what is the status of these conversations?

We announced this week that our board has unanimously determined that the 3D Systems proposal does not constitute a superior proposal and it does not provide a basis for Stratasys to enter into discussions with them.

As for Nano Dimension, our board unanimously determined that Nano’s partial offer is inadequate and badly undervalues Stratasys’ industry-leading position and growth opportunities, which are even larger in light of the pending merger with Desktop Metal. Nano’s $18.00 per share partial tender offer reflects a 1.5x sales multiple, based on consensus 2023 sales, which is a substantial discount to where our peers trade. Additionally, Nano’s tender offer does not reflect the full value of the business, especially given our pending merger with Desktop Metal and the fact that Stratasys is moving toward stronger and more profitable growth.

At this point, the offer is open through June 26, unless Nano Dimension extends it, and our board is recommending that shareholders deliver a Notice of Objection via their brokers against that tender offer. So that’s where things sit at the moment.

3DN: What can users and companies expect from you in the near future?

The most important thing that the industry can expect is for us to continue to be customer first. Right now, our team is staying focused on the business and meeting our customers’ needs. We’re very much taking a solutions-driven approach. It’s not about giving them a printer and leaving it to them to get the value. It’s about giving them the system, the materials, the software and the service and support tailored to a specific use case, whether that is manufacturing tooling for EV production or a more efficient way to provide beautiful-looking dentures, or light-weight, high-performance aerospace parts. Combining with Desktop Metal would ultimately let us deliver even more of these solutions to our customers through our world-class go-to-market organization, and we’re really looking forward to being able to provide that extra value.

3DN: Any last words for our readers?

This is ultimately about maximizing value creation with integrated hardware, software and materials solutions, use case by use case.  This approach will move us towards a world where 10% or more of manufacturing is powered by 3D printing. It takes scale and consistent performance to make additive manufacturing mainstream manufacturing. That’s why we are seeking this combination with Desktop Metal.  I’m excited about it. You can learn more about the union HERE.

What do you think of the union between Desktop Metal and Stratasys? Let us know in a comment below or on our LinkedIn, Facebook, and Twitter pages! Don’t forget to sign up for our free weekly Newsletter here, the latest 3D printing news straight to your inbox! You can also find all our videos on our YouTube channel.

*Cover Photo Credits: Stratasys

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