TCT Magazine
Stratasys has announced that its board of directors, after consultation with its financial advisor and outside legal counsel, has “unanimously determined” that the July 13, 2023 revised proposal from 3D Systems, would “reasonably be expected” to result in a superior proposal, as defined in the Stratasys merger agreement with Desktop Metal. The company now intends to enter discussions with 3D Systems.
The July 13 deal to acquire Stratasys offered 7.50 USD in cash and 1.5444 newly issued shares of 3D Systems common stock per ordinary share of Stratasys.
Stratasys says that it intends to engage in discussions with 3D Systems, with respect to the revised proposal, subject to the requirements of the Desktop Metal merger agreement.
Stratasys entered into a merger agreement with Desktop Metal, as announced on May 25, to combine in an all-stock transaction. Stratasys remains bound by the terms of the merger agreement.
Stratasys says its board of directors has not determined that the July 13 revised proposal constitutes a superior proposal to the Desktop Metal merger, but that it would be reasonably be expected to. Stratasys also says that its board has not changed its “unanimous approval, recommendation, and declaration of advisability of the transaction with Desktop Metal”.
Stratasys states that there can be “no assurance” that discussions with 3D Systems will result in a “superior proposal”, an agreement, or a transaction.
Read more:
A complete timeline of the Stratasys + Nano Dimension + Desktop Metal + 3D Systems story (so far)
3D Systems submits third Stratasys takeover offer, worth $2 billion
Nano Dimension submits new Stratasys offer of $24 per share in cash; Stratasys to review
Interview: Stratasys CEO Yoav Zeif details the strategy behind Desktop Metal merger
Stratasys and Desktop Metal to merge in deal worth $1.8 billion
Simultaneously with the release of the statement detailing the company’s intention to engage in discussions with 3D Systems, Stratasys also announced that its board of directors has “unanimously rejected” the revised partial tender offer from Nano Dimension, as well as releasing an investor presentation highlighting “Nano’s attempt to destroy significant value and growth opportunities for all Stratasys shareholders”.
Stratasys says that its board of directors determined that the partial tender offer, to acquire ordinary shares of Stratasys for 24.00 USD per share is “misleading, coercive, substantially undervalues the company as a whole” and is “not in the best interests of all Stratasys shareholders”.
Stratasys’ press release included “key points” from the investor presentation:
- Nano’s partial tender means Stratasys shareholders who tender their shares may have as few as approximately 40% of their shares purchased, assuming full participation in the offer. If the partial tender offer is successful, additional shareholders are likely to tender their shares during the mandatory 4-day extension window, and shareholders may retain approximately 60% of their existing shares in a Nano-controlled Stratasys.
- The partial tender offer implies a blended value of approximately $15 to $19 per share or less, assuming full participation in the offer, given that Stratasys being controlled by Nano is likely to lead to Stratasys shareholders’ remaining shares trading at a heavily discounted level, which could be approximately $9 to $15 per share or less.1
- Nano has destroyed significant value and trades at negative firm value. Yoav Stern, Nano’s CEO, cannot be trusted, has made misrepresentations about Stratasys and is not qualified to manage Stratasys. Since Yoav Stern’s appointment, Nano has spent more than $500 million in cash and increased its revenue by only $44 million.
- If the partial tender offer is successful, significant conflicts of interest would exist that are likely to be detrimental to Stratasys and its minority shareholders. Nano and Yoav Stern may not be incentivized to act in the best interest of minority shareholders of Stratasys, and Nano could block any future transaction that might maximize value for Stratasys and its minority shareholders, including Stratasys’ ability to engage in discussions with 3D Systems.
Stratasys says that unlike tender offers in the United States, under Israeli rules, Nano Dimension’s partial tender offer will fail if the number of notices of objection are greater or equal to the number of shares tendered in the offer. The full Stratasys letter detailing the board’s rejection of the tender offer can be found here.
