Nano Dimension to acquire Desktop Metal

July 3, 2024

Nano Dimension and Desktop Metal have announced that Nano Dimension will acquire all outstanding shares of Desktop Metal
Nano Dimension and Desktop Metal have announced that Nano Dimension will acquire all outstanding shares of Desktop Metal

Nano Dimension, based in Waltham, Massachusetts, USA, and Desktop Metal, Inc, headquartered in Burlington, Massachusetts, USA, have jointly announced that they have entered into a definitive agreement under which Nano Dimension will acquire all outstanding shares of Desktop Metal in an all-cash transaction for $5.50 per share, subject to possible downward adjustments to $4.07 per share. At $5.50 per share, the transaction represents a 27.3% premium to Desktop Metal’s closing price and a 20.5% premium to the 30-day VWAP as of 2 July 2024, for total consideration of approximately $183 million, possibly down to $4.07 per share or $135 million in total.

Together, the combined company is expected to have a strong financial profile and cash reserves, to support a path to profitability and strategic initiatives: The combination will enable pooling of resources in administration, sales, marketing and R&D and generate efficiencies and cost savings opportunities, while enhancing R&D and innovation capabilities.

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The combination is anticipated to generate in excess of $30 million in run-rate synergies over the next few years, in addition to previously announced cost savings from each of the two organisations. Business operations and capabilities will provide for consolidation opportunities as the combined company focuses on core geographies, including offices, R&D and manufacturing facilities in the multiple US locations, UK, Germany, Switzerland, Netherlands, Italy, Israel and APAC.

Yoav Stern, Nano Dimension’s Chief Executive Officer and member of the Board of Directors, said, “Our combination with Desktop Metal is another step in Nano Dimension’s evolution to become the leader in digital manufacturing, with capabilities in mass manufacturing for critical industrial applications. We’re excited to join forces with an excellent group of technology leaders, all of whom share our vision for transforming manufacturing to Digital Industry 4.0. I look forward to working with Ric Fulop and his team to drive value for all our stakeholders, including creating opportunities for our employees as part of a larger, more diversified global innovative company, driving customer support and generating long-term growing value for shareholders as we focus on profitable growth.”

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Ric Fulop, Desktop Metal’s Co-Founder and Chief Executive Officer, stated, “We’re excited to bring together our pioneering, complementary product portfolios that will further enhance our ability to serve our customers in high-growth industries with a more complete offering of digital manufacturing technologies for metal, electronics, casting, polymer, micro-polymer and ceramics applications. We look forward to working with Nano Dimension to join two great companies and their devoted teams that can serve our stakeholders to the maximum extent possible.”

Subject to the terms and conditions of the merger agreement, Nano Dimension will acquire all of the outstanding shares of Desktop Metal for $5.50 per share in cash. The purchase price may be adjusted for:

  • Transaction expenses: Desktop Metal estimates that transaction expenses will be approximately $11 million, which would result in an approximate decrease of $0.44 per share. The maximum reduction, based on expenses, is $0.63 per share.
  • If the closing of the transaction extends into 2025, Nano Dimension has committed to providing Desktop Metal with a $20 million secured loan facility. Desktop Metal does not expect to draw on the facility, but to the extent it does, there will be an adjustment to the purchase price based on the amount drawn prior to closing of up to $0.80 per share.
  • If all reductions will occur, the price will be $4.07 per share, a total consideration of $135 million.

The closing of the transaction is subject to certain closing conditions, including the approval of Desktop Metal’s stockholders, required regulatory approvals, and certain termination rights as described in the merger agreement.

The transaction, which was reportedly unanimously approved by the Boards of Directors of both companies, is expected to close in the fourth quarter of 2024, subject to the satisfaction of customary closing conditions described above.

The transaction is not subject to a financing condition. Nano Dimension intends to finance the transaction using its cash on hand. The combined company is expected to have a strong cash position at closing, with approximately $665 million at the $5.50 per share price, or $680 million at the reduced price of $4.07 per share price as described above, of projected cash and cash equivalents post-transaction, which assumes no repurchases of Desktop Metal’s $115 million outstanding convertible notes which will be required as a result of the transaction if holders accept the offer to repurchase unless refinanced.

www.nano-di.com

www.desktopmetal.com

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