Full Analysis of the Stratasys and MakerBot 3D Printing Acquisition
Full Analysis of Stratasys and MakerBot Deal
On June 19, desktop 3D printer company MakerBot was acquired by Stratasys for $403 million. The next day, executives from Stratasys and MakerBot hosted a conference call with analysts to discuss the transaction. Seeking Alpha published a full transcript of the call and we provide our analysis on the deal below.
Executives on the call included:
- Shane Glenn – VP Investor Relations
- S. Scott Crump – Chairman of the Board
- David Reis – Chief Executive Officer
- Bre Pettis – CEO and Co-Founder of MakerBot
- Erez Simha – Chief Operations Officer, Israel and Chief Financial Officer
Stratasys Definitive Move into Desktop 3D Printer Market
Stratasys has long been a leader in the additive manufacturing industry. In December they completed a merger with Israel-based Objet to create a $3 billion 3D printer company. Now, with the addition of MakerBot, Stratasys is definitively embracing the desktop 3D printer market.
The executives commented that desktop 3D printing is the next industrial revolution.
It has been widely reported that MakerBot has major customers in organization like GE, NASA and Lockheed Martin, and continue to sell its desktop 3D printers to other Major Fortune 500 companies as well as small entrepreneurial startups and individuals.
Desktop 3D printing usage among design and engineering professional is growing rapidly. Stratasys and MakerBot estimate that between 35,000 to 40,000 desktop 3D printers were sold in 2012. This number is estimated to double in 2013, as consumers increasingly adopt desktop 3D printers for broad range of applications.
In acquiring MakerBot, Stratasys has expanded its scope, selling 3D printers priced from $2,000 to more than $600,000 for all purposes. The MakerBot products allow for more accessibility and affordability of 3D printers that will enable more rapid growth.
MakerBot Company Profile
MakerBot, headquartered in Brooklyn, is the market leader in desktop 3D printing, selling more than 22,000 3D printers since 2009. The company has 274 employees.
MakerBot generated revenues of $15.7 million in 2012, and grew rapidly to $11.5 million in Q1 2013. The company sells two 3D printers: the MakerBot Replicator 2 Desktop 3D Printer, and the MakerBot Replicator 2X Experimental 3D Printer. Retail prices range from $2,200 to $2,800. The majority of sales are placed on the MakerBot website. 60% of customers are based in North America, and 40% international.
The 3D printers are assembled in Brooklyn at a 55,000 square foot production facility in the Sunset Park neighborhood.
MakerBot hosts a web community called Thingiverse, where users can upload 3D printable files. There are more than 90,000 3D product files online and the site has more than 500,000 unique visitors and 1 million downloads each month.
Bre Pettis’ View
MakerBot CEO shared his perspective on the deal:
Our company shares a vision about how to lead the market’s growth and development and it’s all about creating a great user experience. We are very proud of what we have built at MakerBot, but we’ve only just begun. That’s why we are so attracted by the opportunity to join with Stratasys.
Our mission remains the same. Merging with Stratasys offers us an opportunity to continue to build our business and pursue our vision under the MakerBot brand. The last couple of years have been incredibly inspiring and exciting for us. We have an aggressive model for growth. Partnering with Stratasys will allow us to supercharge that mission to empower individuals to make things using a MakerBot and allow us to bring 3D technology to more people.
Deal Structure
Stratasys will issue 4.76 million shares of its stock, worth $403 million, in exchange for 100% of the outstanding capital stock of MakerBot.
In addition, MakerBot stakeholders will also be eligible for performance-based earn-outs of up $201 million through the end of 2014.
Read the full transcript at Seeking Alpha.
[...] to discuss the transaction. Seeking Alpha published a full transcript of the call. Refer to Analysis of Stratasys and MakerBot Deal on On 3D [...]