Stratasys and Desktop Metal to merge in $1.8 billion all-stock transaction

May 25, 2023

Stratasys and Desktop Metal have announced the companies will combine in an all-stock transaction valued at approximately $1.8 billion
Stratasys and Desktop Metal have announced the companies will combine in an all-stock transaction valued at approximately $1.8 billion

Stratasys Ltd and Desktop Metal, Inc, have announced a definitive agreement whereby the companies will combine in an all-stock transaction valued at approximately $1.8 billion. Together, the merger creates an Additive Manufacturing company delivering industrial metal, polymer, sand and ceramic solutions from design to mass production.

Under the terms of the agreement, which has been unanimously approved by the Boards of Directors of both companies, Desktop Metal stockholders will receive 0.123 ordinary shares of Stratasys for each share of Desktop Metal Class A common stock. This represents a value of approximately $1.88 per share of Desktop Metal Class A common stock based on the closing price of a Stratasys ordinary share of $15.26 on May 23, 2023.

Following the closing of the transaction, which is expected to occur in the fourth quarter of 2023, existing Stratasys shareholders will own approximately 59% of the combined company, and legacy Desktop Metal stockholders will own approximately 41% of the combined company, in each case, on a fully diluted basis.

The transaction establishes an Additive Manufacturing company that is expected to be one of the largest companies in the industry, targeting $1.1 billion in 2025 revenue.

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“Today is an important day in Stratasys’ evolution,” stated Dr Yoav Zeif, CEO of Stratasys. “The combination with Desktop Metal will accelerate our growth trajectory by uniting two leaders to create a premier global provider of industrial Additive Manufacturing solutions. With attractive positions across complementary product offerings, including aerospace, automotive, consumer products, healthcare and dental, as well as one of the largest and most experienced R&D teams, industry-leading go-to-market infrastructure and a robust balance sheet, the combined company will be committed to delivering ongoing innovation while providing outstanding service to customers. We look forward to building on the complementary strengths of the combined business and leveraging the strong brand equity across the portfolio to deliver enhanced value to shareholders, customers and employees.”

“We believe this is a landmark moment for the Additive Manufacturing industry,” added Ric Fulop, co-founder, Chairman and CEO of Desktop Metal. “The combination of these two great companies marks a turning point in driving the next phase of Additive Manufacturing for mass production. We are excited to complement our portfolio of production metal, sand, ceramic and dental 3D printing solutions with Stratasys’ polymer offerings. Together, we will strive to build an even more resilient offering with a diversified customer base across industries and applications in order to drive long-term sustainable growth. We look forward to combining with Stratasys to deliver profitability while driving further innovation for a larger customer base and providing expanded opportunities for our employees.”

Following the close of the transaction, Dr Zeif will lead the combined company as Chief Executive Officer together with Ric Fulop as Chairman of the Board. Upon completion of the transaction, the combined company’s Board of Directors will be comprised of eleven members, five of whom will be selected by Stratasys, and five of whom will be selected by Desktop Metal, plus Dr Zeif as CEO. Stratasys Chairman Dov Ofer will serve as lead independent director of the combined company.

The transaction also brings together complementary IP portfolios with more than 3,400 patents and pending patent applications. Together, Stratasys and Desktop Metal have invested over $500 million in R&D over the last four fiscal years. In addition, the combined company will have one of the largest R&D and engineering teams in the industry, with over 800 scientists and engineers focused on driving innovation across a differentiated materials library.

With more than 27,000 industrial customers, the combined company expects to serve a large customer base across multiple industries, materials and applications, and will drive significant recurring revenue from consumables.

www.stratasys.com

www.desktopmetal.com

UPDATE: Stocks rise, 3D Systems outlines value in Stratasys takeover

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