3D Systems (NYSE:DDD) has announced that it has signed a definitive agreement to acquire Geomagic. This acquisition is subject to customary closing conditions, and is expected to close during the first quarter of 2013, after those conditions are met. Terms of the transaction were not disclosed.
The combination of Geomagic’s powerful sculpting, modeling, scanning and inspecting software tools with 3D Systems’ portfolio strengthens its 3D authoring platform and positions the company for accelerated growth in the fast-growing, 3D content-to-print space. The transaction adds complementary products and technology, increases the company’s reseller coverage globally and is expected to be accretive to its non-GAAP earnings in the first full year following the completion of transaction.
“Geomagic represents the perfect strategic fit for us and we will be thrilled to welcome 3D pioneer and Geomagic Founder and CEO Ping Fu as our Chief Strategy Officer once the deal has closed,” said Abe Reichental, President and CEO, 3D Systems. “Our complementary capabilities in product development, channel coverage and marketing combined with greater efficiencies are sure to result in more affordable and user friendly solutions that will delight our customers and could present attractive long term shareholder value. In line with that, we intend to expand the range of our 3D authoring solutions further into new manufacturing and consumer applications and concurrently maintain and enhance the existing Geomagic and Rapidform product lines.”
“We have worked with 3D Systems for many years to accelerate adoption of 3D content-to-print solutions and believe that now is the right time to combine our efforts to further democratize access to design and 3D printing,” said Ping Fu, Founder and CEO of Geomagic. “Joining 3D Systems provides us with the scale, resources and strategic platform to realize our shared vision of delivering functional, affordable and extensible 3D authoring solutions for the benefit of professional designers and engineers, as well as the exciting maker’s movement.”
Strategic and Financial Benefits
- Growing reseller channel accelerates revenue growth from combined portfolio and presence
- Profitable razor and blades business with accretive software gross profit margins enhances non-GAAP earnings power
- Highly complementary portfolio delivers powerful and affordable design and manufacturing solutions and greater customer value
- Expected to be accretive to non-GAAP earnings in the first full year following completion of transaction (1)
(1) The statements regarding non-GAAP earnings are not intended to be a profit forecast and should not be interpreted to mean that earnings for the current or future financial periods will necessarily be greater than those for the relevant preceding financial period. When we speak of non-GAAP earnings above, we are speaking of our post-acquisition expectation for earnings taking account of certain non-cash items such as amortization, non-cash compensation and non-cash interest.