Desktop Metal to be acquired by 3D printer maker in $1.8B deal

Burlington-based Desktop Metal Inc. (NYSE: DM) said Thursday that 3D printing company Stratasys Ltd. (Nasdaq: SSYS) will buy a controlling stake in the company, confirming reports that surfaced hours before that a deal was nearing. It's one of the largest acquisitions involving a Bay State tech company so far in 2023.

Desktop Metal Inc., which went public through a reverse merger in 2020, plans to merge itself with Stratasys through an all-stock transaction valued at $1.8 billion. Existing Stratasys shareholders are slated to own approximately 59% of the combined company following the closing of the transaction, which is expected in the fourth quarter.

After closing, Stratasys CEO Yoav Zeif will lead the combined company as CEO, with Desktop Metal CEO Ric Fulop set to become chairman of the board. Fulop was not available for an interview on Thursday.

The deal brings together Desktop Metal's portfolio of production metal, sand, ceramic and dental 3D printing solutions with Stratasys’ polymer 3D printing offerings. The combined company is expected to generate $1.1 billion in 2025 revenue, according to a release.

Desktop Metal's market capitalization was approximately $554 million in the hours after the announcement, while Stratasys's was around $982 million.

Since going public, Desktop Metal has closed a number of acquisitions itself. In 2021, it closed deals with Dearborn, Mich.-based 3D printing company EnvisionTEC for $300 million and North Huntingdon, Pa.-based The ExOne Co. for $575 million.

Desktop Metal ended last year with $209 million in revenue and a net loss of $740.3 million.

"We look forward to combining with Stratasys to deliver profitability while driving further innovation for a larger customer base and providing expanded opportunities for our employees," Fulop said in a statement.

The Desktop Metal's deal comes as at least two other tech companies based in Massachusetts are rumored to be acquisition targets: another Burlington-based firm, Avid Technology Inc. (Nasdaq: AVID), and Boston-based Rapid7 Inc. (Nasdaq: RPD).