Saw this. Article in the Strib
Eden Prairie-based Stratasys to buy MakerBot for $403 million
By Steve Alexander, Star Tribune
Wednesday, June 19, 2013 | 8:48 PM
Stratasys, a top manufacturer of corporate 3-D printers that build objects out of sprayed material, has acquired the consumer-oriented MakerBot in a $403 million stock transaction.
The deal could grow to $604 million based on $201 million in additional payments to MakerBot if certain performance benchmarks are reached. MakerBot is based in New York.
3-D printers are a hot technology that hold out the promise of revolutionizing the manufacturing of some everyday objects, such as coffee pots, machine parts and, to the dismay of some, guns, by personal devices that print physical objects by layering deposits of sprayed material.
The acquisition, which had been rumored for weeks, will position corporate-oriented Stratasys to compete more directly with its largest 3-D printer rival, 3-D Systems, which last month began selling some consumer-oriented 3-D printers through Staples stores.
The acquisition was announced after the market closed. Stratasys stock closed at $84.60 Wednesday, down $1.52, or nearly 2 percent.
The deal, expected to be completed in the third quarter, is a shift in strategy for Stratasys, which has focused on cabinet-sized machines used by corporations to make product models and prototypes. The company now believes that the biggest market growth will be in desktop-sized personal-use 3-D printers, the type that MakerBot focuses on.
Stratasys and MakerBot said in a statement that they estimated 35,000 to 40,000 of the desktop-sized 3-D printers were sold in 2012, a number that is expected to double in 2013.
“MakerBot’s 3-D printers are rapidly being adopted by computer-aided-design-trained designers and engineers,” said CEO David Reis of Stratasys, based in Eden Prairie and Rehovot, Israel.
Privately owned MakerBot had revenue of $11.5 million in the first quarter, compared with $15.7 million for all of 2012, the two companies said.
The acquisition “is expected to drive faster adoption of 3-D printing for multiple applications and industries, as desktop 3-D printers are becoming a mainstream tool,” Stratasys said in a statement.
MakerBot would be operated as a separate subsidiary of Stratasys, which will initially issue about 4.76 million of its shares in exchange for MakerBot.
While some of the possibilities of 3-D printing remain more science fiction than fact, given that the plastic parts generated by 3-D printers are not as durable as their metal counterparts, the technology has found wide applications in industry as a way to rapidly turn around prototypes of new products.
Stratasys Ltd. builds 3-D printers and the materials they spray for the creation of product prototypes and models. The company was formed through the Dec. 3, 2012, merger of Stratasys Inc. and Objet Ltd., a similar firm based in Rehovot, Israel. Revenue for the two companies, calculated as if they had been combined at the start of 2012, rose 29.6 percent to $359.1 million and earnings per share grew 59.1 percent to $1.49 per share. During the past 12 months, Stratasys shareholders have earned a 76 percent total return.
But MakerBot has taken the consumer path. In February, the New York Times reported that MakerBot, founded in 2009, made consumer 3-D printers that allow people to create their own parts to fix a blender or provide lifts for shoes.
MakerBot maintains a database of 36,000 downloadable designs that can be created on its printers. Last fall, the company opened in New York City what was believed to be the first retail store for 3-D printers.
Consumer products being made with today’s 3-D printers include jewelry, clothing, toys and prosthetic limbs. Earlier this year, a law student at the University of Texas at Austin posted online the 3-D printer pattern for printing a handgun he called the “Liberator.” The student, Cody Wilson, removed the pattern from the Internet after the State Department demanded he do so because of possible export control violations.
Additive manufacturing, including 3-D printing, is a $2.2 billion industry, according to a 2013 report prepared by Wohlers Associates, an industry consulting group in Fort Collins, Colo.
Steve Alexander • 612-673-4553