3-D Printer Cos. Ink $1.4B Pact To Join Forces (Law360)
By Maria Chutchian
Three-dimensional printer manufacturers Stratasys Inc. and Objet Ltd. have entered into a merger that represents a combined equity value of about $1.4 billion, they announced Monday.
Under the agreement, Stratasys will merge with an Objet subsidiary. Stratasys shareholders will receive one share of the new combined company for each share of Stratasys common stock they own, and the two companies expect that once the transaction is completed, Stratasys investors will own 55 percent and Objet shareholders will own 45 percent of the combined company.
Stratasys is a manufacturer of 3-D printers and production systems for prototyping and manufacturing applications. Privately held Objet manufactures 3-D printers for rapid prototyping. The two said their combined abilities would lead to a more diverse selection of products for their customers.
"Together we will have a broader and more comprehensive product and technology portfolio, and the resources, team and financial strength to achieve our goals," Stratasys CEO and Chairman Scott Crump said. "Building on the success of both companies, I am confident that we will capitalize on the many opportunities this combination creates for our shareholders, channel partners, customers, employees and other important stakeholders."
Pending investors' and regulators' approval, the companies expect the transaction to close in the third quarter of 2012. The merged company will operate under the name Stratasys Ltd. and will have dual headquarters in Eden Prairie, Minn., and Rehovot, Israel, where the companies' current headquarters are currently located.
Crump will be the full-time chairman and Objet Chairman Elchanan Jaglom will serve as chairman of the executive committee of the combined company.
Objet CEO David Reis said the company was excited to join forces with Stratasys.
"This transaction creates an organization that will provide a broad range of rapid prototyping and direct digital manufacturing applications to our customers and the ability to bring exciting new products to the market," he said.
The companies said the merger would give them the ability to research and develop new 3-D printer materials and products with complementary functionality and expand its access to new customers across several industries.
Those new products will "bring together Objet's expertise in design verification and visualization with Stratasys' leadership in functional testing and direct digital manufacturing," the companies said.
Stratasys and Objet also predict that they will see annual revenue growth of at least 20 percent and an effective tax rate of between 15 and 20 percent.
Stratasys says it is expecting a revenue report for the first quarter of 2012 of about $45 million, a 31 percent increase from the $34.3 million reported during the same period last year.
Stratasys is represented by McLaughlin & Stern LLP, Richards Layton & Finger PA, Latham & Watkins LLP and Fischer Behar Chen Well Orion & Co.
Objet is represented by Cooley LLP and Meitar Liquornik Geva & Leshem Brandwein.
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