Rehovot, Israel-based Stratasys Ltd. (NASDAQ: SSYS) is to acquire 3D San Francisco, CA-based printing startup Origin Inc., for total consideration of up to $100m, including cash and stock.
Subject to various approvals and other closing conditions, the acquisition is expected to close in January 2021. Under the terms of the deal, the total consideration for the transaction is comprised of $60m paid on closing ($6m of which is subject to the founders’ retention over 3 years) and $40m that is subject to performance-based earnouts over 3 years. The acquisition will be paid using a combination of stock of approximately $45m and cash of approximately $55m at closing and throughout the earnout period. Approximately $32m of the cash expenditure will be at closing.
The acquisition is expected to accelerate Stratasys’ growth rate and be slightly dilutive to non-GAAP earnings per share in 2021, and accretive to Stratasys’ non-GAAP earnings per share by 2023.
The Origin team will join Stratasys and lead the development of its technology and product platform, with a full global launch via the Stratasys go-to-market organization towards mid-2021. The merger enables Stratasys to expand its leadership through innovation in the fast-growing mass production parts segment with a next-generation photopolymer platform.
Stratasys expects Origin’s proprietary Programmable PhotoPolymerization (P3) technology to be an important growth engine for the company, adding up to $200 million incremental annual revenue within five years. The acquisition will help fortify Stratasys’ leadership position in polymers and production applications of 3D printing in industries such as dental, medical, tooling, and select industrial, defense, and consumer goods segments.
Led by CEO and co-founder Christopher Prucha, Origin provides Origin One, a manufacturing-grade 3D printer, which uses Programmable PhotoPolymerization to precisely control light, heat, and force, among other variables, to produce parts with accuracy and consistency. The company works with a network of partners to develop a wide range of commercial-grade materials for its system, resulting in some of the toughest and most resilient materials in additive manufacturing. Investors include Floodgate, DCM, Mandra Capital, Haystack, TDK Ventures, Stanford University, and Joe Montana.
Led by CEO Yoav Zeif, Stratasys is a global leader in additive manufacturing or 3D printing technology and is the manufacturer of FDM®, PolyJet Technology™, and stereolithography 3D printers. The company’s technologies are used to create prototypes, manufacturing tools, and production parts for industries including aerospace, automotive, healthcare, consumer products and education. The Stratasys 3D printing ecosystem of solutions and expertise includes 3D printers, materials, software, expert services, and on-demand parts production.