Stratasys has suggested that 3D Systems has not yet provided sufficient cost synergy information, after 3D Systems announced a target date of August 4, 2023 for completion of due diligence and merger agreement discussions.
The two companies have been negotiating a potential merger since July 17, despite Stratasys announcing a merger agreement with Desktop Metal in May. Should 3D Systems and Stratasys reach a merger agreement of their own, 3D Systems has offered to pay the termination fee on the Desktop Metal deal on behalf of Stratasys.
In its latest communication Stratasys has stated:
Contrary to 3D Systems’ statements in its press release as to the exchange of due diligence materials and multiple meetings between the parties, Stratasys has moved expeditiously to provide data requested by 3D Systems for review, as well as having already conducted management meetings. On the other hand, we have repeatedly requested that 3D Systems reciprocate with the same information for their company, as well as their assessment of potential negative revenue synergies. While 3D Systems has provided some cost synergy analysis, it’s only high level and lacks critical details that would substantiate their cost synergy claims. Despite the implication in 3D Systems’ press release that they have engaged cooperatively, we are still waiting for all this information from 3D Systems. For a transaction where the majority of the proposed merger consideration comes in the form of 3D Systems common equity, the Stratasys Board needs to understand these crucial details to make a responsible and informed decision.
The press release continues:
Stratasys also notes that 3D Systems has added for the first time that their public proposal of July 13, 2023 is also their “best and final proposal” as to the form and amount of merger consideration. 3D Systems does not state whether that was the case on July 13, 2023, whether, when or why their thinking as to negotiation has changed. Regardless of 3D Systems’ changing pronouncement and tactics, the Stratasys Board will evaluate any and all proposals holistically, taking into account the necessary due diligence and analysis, including regulatory analysis. If 3D Systems is serious about achieving a combination with Stratasys, the path forward lies with cooperation and transparency and not distorted public statements.
Stratasys states that once the requested due diligence information is received, its Board of Directors will be in a position to make a determination 'as to whether the July 13, 2023 proposal, or any further revised and improved proposal, made by 3D Systems, represents a Superior Proposal, as defined in the merger agreement with Desktop Metal.'
The company also again reiterated that it has not determined that 3D Systems’ July 13, 2023 revised proposal constitutes a Superior Proposal as defined in the merger agreement with Desktop Metal, and it has not changed its unanimous approval, recommendation and declaration of advisability of the transaction with Desktop Metal.
The press release concludes: "Stratasys will continue to abide by all of the terms and provisions of the Desktop Metal merger agreement."
Earlier this week, Nano Dimension announced it is “standing down” on its Stratasys merger attempt and has and withdrawn its special tender offer.
