Nano Dimension took another step forward with Desktop Metal shareholders approving the proposed merger.
In July the two companies announced an all-cash deal for Nano Dimension to acquire Desktop Metal outright. The deal’s value was approximately US$183M, a premium over Desktop Metal’s valuation at the time.
However, there were several steps required to get to the deal’s finish line. One was regulatory approval from the US government, which ensures monopoly situations are not being created. That barrier was overcome in late August.
The major remaining hurdle was approval by the Desktop Metal shareholders, which was achieved this week.
How did the vote go? The results were a bit interesting. Desktop Metal explained:
“Of approximately 33 million outstanding DM shares, 60% were voted in favor of the approval of the merger agreement between Desktop Metal and Nano Dimension. Out of the total shares participating in the vote, greater than 96% of votes were cast in favor of the merger.”
This implies that 40% of Desktop Metal shareholders didn’t even bother to vote. Those that did strongly supported the merger. That’s not surprising, as the company’s valuation has plummeted in recent months, along with several other AM companies. The merger was a path to getting some value from their investment.
What’s next? The Desktop Metal merger will almost certainly be completed, and Nano Dimension will move on to their next acquisition, Markforged, which was announced the other week.
The Markforged acquisition is quite similar, a fully cash deal. It will go through much the same process as Desktop Metal, just a bit later.
When the smoke clears Nano Dimension will find it self the owner of tech from no less than 18 different companies, either from acquisition or inheritance.
Nano Dimension has been using their cash reserve to execute these acquisitions, which is slowly being burned down. They still have more than sufficient cash to acquire a few more players, if they wished. It’s a good time to do so as the valuations of many 3D print companies are at their lowest. Among the possible targets could be:
- Velo3D, a metal LPBF printer manufacturer
- BigRep, a large-format FFF printer manufacturer
- Aurora Labs, a manufacturer of a high-volume metal 3D printing system
On the other hand, Nano Dimension should probably spend considerable effort cleaning up their acquisitions. The investments made in all these companies should generate some profit. That could be from leveraging their sales network to sell additional product types to additional customers, but it can also be through layoffs.
Consider that each of these acquisitions had a fully staffed administrative department, among others. Why would you require 18 different near-identical administrative roles in a variety of departments? Mergers typically result in layoffs of redundant positions, and we haven’t really heard of any from Nano Dimension in spite of all these acquisitions. If the company isn’t intending on doing this, they are leaving money on the table and shareholders may become concerned.
Via Desktop Metal
