3D Systems Delivers Enhanced Proposal to Stratasys
ROCK HILL, S.C., Sept. 11, 2023 (GLOBE NEWSWIRE) -- 3D Systems (NYSE:DDD) today announced the delivery of a revised proposal to combine with Stratasys Ltd. (NASDAQ: SSYS). Each Stratasys share will convert into $7.00 in cash and ownership of 46% of the aggregate shares of the combined company (representing a 1.6387 exchange ratio based on the last disclosed Stratasys share count). 3D Systems believes this consideration mix is worth more than $27 per share to Stratasys shareholders inclusive of synergies.1
The revised offer results from discussions between the two companies and addresses feedback provided by Stratasys during an in-person meeting between directors of both companies on August 22, 2023. Stratasys has responded to this proposal by acknowledging that its diligence has confirmed material cost synergies arising from a combination that would translate into hundreds of millions of dollars of shareholder value, but concluded that the current spot price of 3D Systems shares renders the proposal inadequate. In addition, Stratasys has informed 3D Systems that, despite 3D Systems’ good faith efforts to reach a negotiated transaction for the benefit of all shareholders, Stratasys’ board of directors continues to support the Desktop Metal merger as its preferred alternative and that the Stratasys board is not interested in any further discussions with or proposals from 3D Systems about a combination.
President and CEO Dr. Jeffrey Graves stated, “We listened to shareholder feedback and made a strong effort to reach a friendly transaction but it seems there is no price that would satisfy the Stratasys Board. Shareholders of Stratasys have seen their board turn down offer after offer, watching only the consistent destruction of value in the meantime. The latest game appears to be an attempt to ‘run out the clock’ on supposed discussions with us, while always moving ahead with the massively value-destructive merger with Desktop Metal. We are confident that shareholders will support our combination and send an unequivocal message to the Stratasys board that they can no longer protect themselves while fiddling away shareholder value.” The full terms of 3D Systems’ revised proposal to Stratasys were included in a merger agreement, together with a full set of disclosure schedules, delivered to Stratasys on September 6, 2023, that built upon the terms of the binding merger agreement submitted on July 13, 2023 and filed publicly with the SEC. Updates to the July 13 offer are:
All other terms outlined in 3D Systems’ revised proposal remain substantially the same as those included in the July 13 signed merger agreement. This includes the commitment by 3D Systems to pay the $32.5 million termination fee owed by Stratasys to Desktop Metal upon Stratasys’ exit from its existing merger agreement with Desktop Metal and entrance into this new merger agreement with 3D Systems.
The Company reiterates its view of the key benefits of its proposed transaction with Stratasys:
Dr. Graves continued, “This proposal demonstrates our continued, unwavering belief that a combination of 3D Systems and Stratasys brings unique value. It creates unparalleled scale, significant cost synergies to enhance financial performance and supports long-term growth investments, and a comprehensive technology portfolio to support customers as they increasingly adopt 3D printing in their production environments. We believe that a combination of our two companies is clearly superior to any other potential combination in our industry, and that the vast majority of shareholders in both companies share our view. We will continue to evaluate our options in completing this important transaction to transform the additive manufacturing industry.”
Goldman Sachs & Co. LLC is acting as exclusive financial advisor and Freshfields Bruckhaus Deringer (US) LLP, together with Herzog, Fox & Neeman in Israel, is acting as legal counsel to 3D Systems.
About 3D Systems
All references to the binding nature of the offer and merger agreement being proposed by 3D Systems, whether in a press release, presentation, other document or public statement, are subject to the contents of the escrow letter that has been delivered to Stratasys and will be on file publicly with the SEC.
This document shall not constitute an offer to buy or sell or the solicitation of an offer to sell or buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.
This communication is neither a solicitation of a proxy nor a substitute for any proxy statement or other filings that may be made with the SEC. Nonetheless, 3D Systems and its directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. You can find information about 3D Systems’ executive officers and directors in 3D Systems’ definitive proxy statement filed with the SEC on April 5, 2023. Additional information regarding the interests of such potential participants will be included in one or more registration statements, proxy statements, tender offer statements or other documents filed with the SEC if and when they become available. These documents (if and when available) may be obtained free of charge from the SEC’s website at http://www.sec.gov.
1 Analysis assumes approximately 72.8mm Stratasys fully diluted shares outstanding and 140.0mm 3D Systems fully diluted shares outstanding. Assumes 46.00% Stratasys pro forma ownership in the combined company. Capitalized value of synergies per share equals: $110mm cost synergies, as projected by 3D Systems, multiplied by 15x, multiplied by 46% Stratasys ownership in pro forma entity, divided by Stratasys fully diluted shares outstanding.
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