Nano Dimension to Acquire Desktop Metal: A New Chapter in Additive Manufacturing

Nano Dimension has announced plans to acquire Desktop Metal in a deal that could range from $135 million to $183 million. At the high end, this acquisition represents a premium of over 27% compared to Desktop Metal's closing price. This announcement marks the culmination of more than two years of negotiations between some of the most prominent names in additive manufacturing.

The journey leading to this acquisition has been tumultuous. Desktop Metal, once a rapidly rising star in the industry, underwent a significant staff reduction in July 2022, cutting 12% of its workforce. In the same year, Nano Dimension acquired 12% of Stratasys, an industrial 3D printing giant and owner of MakerBot. The period also saw Nano Dimension dealing with internal shareholder issues while Desktop Metal faced another round of layoffs.

Several months later, Nano Dimension made an offer to take over Stratasys, which was ultimately rejected. Shortly thereafter, Stratasys and Desktop Metal announced merger plans. The news prompted 3D System to make its own bid to acquire Stratasys. Over the following months, multiple acquisition offers from both Nano Dimension and 3D Systems were made, all of which were turned down. The planned merger between Stratasys and Desktop Metal fell through in September.

In an interview with industry publication TCT Magazine that same month, Desktop Metal CEO Ric Fulop expressed the company's independent stance, stating, "We’re 100% independent. Our company is not for sale. Contrary to what people make up, if you look at our cash position and our expenses, going into our first profitable quarter with around $100 million. We don’t need to sell our company, we like our company. And we weren’t selling our company, we were merging our company, we were going to remain working at the company. So, I would say our goal going forward is to grow Desktop Metal independently and make it the best company in mass production in additive."

However, eight months later, Fulop's tone has shifted positively regarding the Nano Dimension acquisition. He noted, "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."

Nano Dimension stated that the deal had been "unanimously approved" by the boards of directors of both companies. The transaction, expected to close in the fourth quarter of this year, will be financed using Nano Dimension's cash reserves.

The proposed acquisition underscores the shifting dynamics in the additive manufacturing sector. With Desktop Metal's extensive range of digital manufacturing technologies and Nano Dimension's established presence in the market, the merger is poised to create a more robust entity capable of offering comprehensive solutions across various applications, including metal, electronics, casting, polymers, micro-polymers, and ceramics.

The additive manufacturing industry has seen significant consolidation in recent years, with companies striving to expand their capabilities and market reach through strategic acquisitions. The potential merger of Nano Dimension and Desktop Metal is a testament to the evolving landscape of the industry, driven by technological advancements and the increasing demand for innovative manufacturing solutions.

As the deal progresses towards finalization, industry stakeholders and customers alike will be closely watching the integration of these two pioneering companies. The combined expertise and resources of Nano Dimension and Desktop Metal promise to deliver enhanced value and innovation, setting a new benchmark in the additive manufacturing domain.

In conclusion, the acquisition of Desktop Metal by Nano Dimension signifies a major development in the additive manufacturing industry. The collaboration aims to leverage their complementary strengths to better serve high-growth markets with a comprehensive suite of digital manufacturing technologies. As both companies prepare for the transition, the industry anticipates the potential breakthroughs and advancements that this merger could bring.