Israeli 3D printer manufacturer Objet Geometries completed its merger with U.S. rival Stratasys on Monday, agreeing to a deal that puts a value of $1.4 billion on Rehovot-based Objet.
Objet's shareholders can expect to receive shares worth this amount in the merged firm, and at least six of Objet's executives and investors will become multi-millionaires in the all-stock acquisition.
The merged company started trading on the Nasdaq stock exchange under the symbol SSYS on Monday, with a value of about $3 billion. Stratasys had a market cap of $1.63 billion before the merger.
The deal, a reverse merger, was originally announced in April and gives Stratasys shareholders about 55% of the combined company. Israel's Objet stockholders will own the rest, the companies said.
Objet had originally planned an initial public offering in the United States around March, at a company value of about $500 million. The IPO prospectus revealed Objet had revenues of $121 million in 2011, a 38% increase from the year before. Forecasts for 2012 put revenues at $157 million, a 30% increase. Stratasys had $156 million in revenues in 2011 and an estimate of $196 million for this year's revenues.
Stratasys shares have risen some 80%, to $75 per share, since the merger was announced in April. The share has slipped somewhat in the past few days and fell 3% after the announcement on Monday, though the stock recovered a bit on Tuesday.
The combined company, which will trade on the Nasdaq as Stratasys Ltd., will have headquarters in both Eden Prairie, Minnesota, and Rehovot, Israel. It will be incorporated here in Israel.
Former Objet CEO David Reis will serve as CEO of the combined company, while former Stratasys CEO and co-founder Scott Crump will act as executive chairman.
Objet's former chairman, Elchanan Jaglom, is chairman of the executive committee. Objet's former chief operations officer and chief financial officer, Erez Simha, is the COO and CFO for the combined company.
Among the big winners are a number of relatively unknown Israeli investors. Jaglom will receive Stratasys shares worth an estimated $360 million, as will Roy Zuckerberg, a former senior executive at Goldman Sachs. The two are partners in Samson Capital, which owns about a quarter of Objet.
Reis, who was formerly the CEO of Nur Macroprinters, owns a 4.3% share of Objet, worth about $58 million. Former Objet CEO Adina Shor will receive some $23 million in shares, and president Ilan Levin will get $29 million worth of shares.
Stratasys said Monday that the buyout will add to its adjusted earnings per share immediately. The company anticipates achieving between $7 million and $8 million in annual cost savings from synergies and between $3 million and $4 million in annual tax savings starting 18 months after closing. The company said the merger is expected to create significant revenue synergies from increased sales, and to be accretive to non-GAAP earnings per share immediately.
"We are excited to move forward as one company and deliver the benefits this combination creates for our shareholders, our customers and our employees," said Reis.
"Stratasys is now uniquely positioned to offer a comprehensive portfolio of innovative products and technologies, and we have the scale, team and financial strength to achieve our goals. I look forward to working closely with the board of directors, our senior management team and all of our employees to ensure a seamless transition as we continue to deliver advanced solutions to our customers worldwide," he added.
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