Stratasys has announced that its Board of Directors has unanimously rejected the revised non-binding proposal to acquire the company put forward by 3D Systems on June 27.
After 'careful review and consultation' with its independent financial and legal advisors, the Stratasys Board has determined that the latest 3D Systems takeover bid 'is opportunistic, continues to materially undervalue Stratasys, does not constitute a “Superior Proposal” and does not provide a basis upon which to enter into discussions with 3D Systems, pursuant to the terms of the merger agreement with Desktop Metal, Inc'.
The deal proposed by 3D Systems earlier this week would convert each Stratasys ordinary share into $7.50 in cash and 1.3223 newly issued shares of 3D Systems common stock. The initial bid, submitted on May 30 2023, had offered $7.50 in cash and 1.2507 newly issued shares per ordinary share.
On May 25, 2023, Stratasys announced an all-stock merger agreement with Desktop Metal, and in this latest communication has stated that its Board 'has not changed its unanimous approval, recommendation and declaration of advisability of the previously announced transaction with Desktop Metal.' This is despite shareholder Donerail Group LP expressing concern over the Desktop Metal merger in an open letter published on June 29. The Donerail Group owns approximately 2.3% of the outstanding shares in Stratasys.
Stratasys response to latest Nano Dimension tender offer
Stratasys has also today reiterated to shareholders that they should not tender their shares to Nano Dimension and should deliver a Notice of Objection against the offer.
After several attempts to negotiate with the Stratasys Board, Nano Dimension has taken to proposing partial tender offers directly to shareholder, with the latest proposal offering to buy shares for 20.05 USD each. The Stratasys Board, again after consultation with its independent financial and legal advisors, suggests that this 'substantially undervalues the company and is not in the best interests of Stratasys shareholders.'
According to Stratasys, tendering into Nano Dimension's partial offer 'would only encourage Nano’s opportunistic and coercive attempt to acquire Stratasys at an inadequate price.' It has also suggested those shareholders who have already tendered should withdraw. Per press releases distributed by both Stratasys and Nano Dimension earlier this week, it is believed around 8% of outstanding shares were tendered in its first partial tender offer (valuing shares at 18.00 USD per share) which would leave Nano Dimension owning around 22% of Stratasys shares.
Stratasys' latest communication to shareholders reads: "Unlike tender offers in the United States, under Israeli rules, Nano’s tender offer will fail if the shares covered by submitted Notices of Objection are greater than or equal to the number of shares tendered in the offer. Therefore, in addition to not tendering, filing a Notice of Objection could help cause the tender to fail. Simply not tendering could result in non-tendering shareholders being left as minority shareholders in a company controlled by Nano. Therefore, we strongly urge shareholders to file their Notice of Objection in order to reduce the risk of becoming a minority shareholder.
"Stratasys has received feedback from many shareholders and brokers that the unfair, coercive offer process constructed by Nano makes it difficult and confusing for shareholders that own Stratasys shares beneficially (as do a vast majority of Stratasys shareholders) to file a Notice of Objection. Stratasys has informed Nano, its tender offer agents and the Israeli courts that this process must be fixed so it is equally as accessible and easy for a beneficial owner of Stratasys shares to file a Notice of Objection as it is to tender shares into Nano’s partial tender offer."
