From Bloomberg:
Super Bowl Cleats Signal 3-D Printer Takeovers: Real M&A
Stratasys Ltd. (SSYS) offers Hewlett-Packard Co. (HPQ) and Seiko Epson Corp. (6724) the chance to move beyond paper-and-ink printers by acquiring a leader in the technology that’s used to replicate nuts, bolts and even football cleats.
Three-dimensional printers layer materials to create objects, technology that Nike Inc. used to help develop footwear for National Football League players to don at this weekend’s Super Bowl. Hewlett-Packard and Seiko Epson have shown interest in expanding into the fast-growing market, which may double by 2017. Rather than build their own 3-D printers, the companies would have a better shot of capturing that growth by buying Stratasys, BB&T Corp. said.
“The first machine was essentially a glue gun compared to what they do today, so to be starting from scratch is to be behind by a lot of patents and a lot of history that you have to make up,” Holden Lewis, a Reston, Virginia-based analyst at BB&T, said in a phone interview. Stratasys “would be an appealing little nugget to sort of fast-forward that process.”
While Stratasys would be a pricey purchase for a buyer with its stock near a record, the company is valued at a 33 percent discount to rival 3D Systems Corp. (DDD), according to data compiled by Bloomberg. The valuation gap makes Stratasys a more appealing target than its larger rival, FBR & Co. said. Suitors also may favor the $5.9 billion company because of its brands such as MakerBot and its greater presence in consumer markets, Credit Suisse Group AG said.
Objects manufactured by 3D printers, including a skateboard and a Smurf figurine,... Read More
Big Slice Shane Glenn, a spokesman for Stratasys, declined to comment, citing company policy, when asked whether it would be interested in a sale.
Stratasys, based in Eden Prairie, Minnesota and Rehovot, Israel, began making 3-D printers more than 20 years ago and now controls one of the largest slices of a market that generated as much as $2.9 billion in revenue worldwide last year, according to consulting firm Wohlers Associates Inc.
Global sales, including all 3-D printing products and services, may double to about $6 billion by 2017 and jump to almost $11 billion by 2021, Fort Collins, Colorado-based Wohlers Associates said. Stratasys alone may boost revenue to about $1 billion by 2016, up from an estimated $482 million in 2013, according to analysts’ projections.
The company, which acquired MakerBot in August, “would be a potentially attractive target for anyone looking to make a big splash within the space,” Angelo Zino, a New York-based analyst at S&P Capital IQ, said in a phone interview. “It instantly gives you a huge presence in the 3-D printing market.”
A visitor approaches the entrance to the offices of Stratasys Ltd., manufacturer of 3D... Read More
*From our December post "Whitney Tilson on Shorting 3D Systems (DDD)":Boeing, Nike
Stratasys’s customers include Boeing Co., (BA) Ford Motor Co., Boston Scientific Corp. (BSX) and Nike, according to a September filing. Nike declined to identify what type of 3-D printing technology it used to develop the football cleats that inspired the shoes for the Super Bowl.
While some larger technology companies are beginning to move into 3-D printing, “it’s certainly a high-risk strategy to do this from scratch internally, and it takes a lot of time,” Ajay Kejriwal a New York-based analyst at FBR, said in a phone interview....MORE
He's right,
...If you look at each company's recent acquisitions, Makerbot for DDD and Objet for SSYS, there's no comparison on who has the smarter long term strategy.which, of course, referred to this little beauty:
Now if only Stratasys would buy Arcam...
...We first mentioned the company in September 2012. The stock was at $10.28 and traded by appointment only. It closed Friday at $113.26.That was from our September 2013 post "Credit Suisse Initiates On 3D Printer Co's: '3D printing will change the world'". The 4:1 split puts the old stock at $173.80.
And the "might-have-been"? From October's "GE: 3D Printing Will 'Touch' Over Half Its Manufacturing":
...As with nanotechnology the most interesting portfolio investments will end up being not the 3D printer manufacturers but the companies that use the tech to gain a competitive advantage.
Still wish I'd put together a buyout for Arcam though.
