Both Solid Concepts and Harvest Technologies are private companies involved in the additive manufacturing business, and Stratasys noted the reason behind the acquisitions was to expand its technology and business offerings of RedEye to better meet the needs of its customers.
The press release said Solid Concepts and Harvest Technologies were founded in 1991 and 1995, respectively, and have expertise in a variety of different industries. Solid Concepts is principally involved in the medical and aerospace sectors, whereas Harvest Technologies works largely in parts production.
"Solid Concepts and Harvest Technologies are industry pioneers and innovators in the additive manufacturing space," noted Stratasys CEO David Reis in the announcement of the acquisitions. "In acquiring these two unique companies, Stratasys is gaining a broad solutions offering with technologies and decades of application and manufacturing experience, which, together with RedEye, are expected to create an industry-leading additive manufacturing and parts production platform."
Stratasys noted four principal benefits of the transaction: the ability to provide customers a comprehensive solution based on their needs, an opportunity to grow its expertise across a wide range of applications, the creation of potential cross-sell opportunities across business units, and compelling potential financial benefits.
The acquisition of Solid Concepts will be made with a payment of $172 million upon the closing of the transaction and another $60 million in deferred payments. There is also a potential for retention-related payments, which could bring the total cost to $295 million. Last year, Solid Concepts had revenue of $65 million.
The financial terms for Harvest Technologies were not disclosed, but Stratasys said that it anticipates the acquisitions will be additive to its non-GAAP earnings per share within one year of the closing. It is expected the transactions will be complete in the upcoming quarter.
"As our customers' requirements continue to expand, we must evolve to create full service offerings that provide a variety of technologies and custom manufacturing solutions and focus on high-end production applications," Reis was quoted as saying.
He concluded in the press release by noting, "Importantly, with our shared cultures of innovation and customer service, we believe this will be a smooth transition."
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