Dream 3D Printing IPOs we’d love to see: GE Additive and EOS – 3DPrint.com
Since the response to my Dream M&A posts has been so positive, our editor-in-chief Michael asked me to review a few 3D printing IPOs that we would like to see in 2021.
Let’s start with the obvious: EOS is the leader in powder bed fusion printers, both for polymers and metals. The competitor SLM Solutions is public. Arcam and Concept Laser were acquired by GE. Realizer was acquired by DMG Mori. Other competing companies have benefited from significant investments.
EOS alone is capable of developing parts and techniques suitable for deployment on its thousands of polymer and metal machines. It also has the largest installed base and is the only real global player in the sintering of polymers. EOS is also a leader in metals, although GE and, in particular, SLM Solutions exert some competitive pressure. New entrants, such as VELO3D, should also bring more pressure in the years to come.
But, all in all, EOS has a huge lead in terms of revenue, profitability, and installed base over everyone else. It is also a trustworthy company. They are also working on future “laser million diodes” technologies. A listed global 3D printing company would be a huge victory for Germany and German industry. It would also help EOS beat the competition from upbeat PSPC attendees.
It’s pretty unlikely, however. EOS is 100% owned by the Langer family and EOS CEO Marie Langer told us on 3DPOD (embedded below) that a public offering was not being considered.
3DPOD Episode 22: Marie Langer the CEO of EOS
That said, a dozen PSPCs later, the family may have changed their minds. Going through class A and class B shares, the family could retain a great deal of control over a state-owned enterprise for many generations, especially if this is in part accompanied by a family office or similar.
The Langers seem much more concerned with the inheritance than the money at the moment. The firm is conservative and looks at the very long term. Overall, EOS would be highly unlikely to go public. If the family claims this is a unique opportunity to become a DAX business, then maybe they can be persuaded. However, they are more likely to prefer to stay away from the spotlight and, rather than looking to the future in a quarter-to-quarter window, think about it across years, decades, and generations.
GE has entered the 3D printing industry very aggressively with the acquisitions of Morris, Arcam and Concept Laser. Frankly, people were terrified of what GE’s ruthless gang had planned for all of us. The logic seemed inexorable with any weight savings on GE’s train-aircraft-turbine empire leading to faster industrialization of GE’s machines which would become ever more production-ready and more efficient as a result.
The use of additives in electrical equipment, train engines and, most importantly, the highly profitable and incredibly difficult aviation engine business would ensure that GE maintains a lead in all these areas through the application of optimized parts. for topology, faster-to-market, lower inventory and higher performance. It looked like some kind of beautiful automatic catalytic cycle.
And it could have been, would have been and somehow, in another dimension much more stable, still is. There is a parallel universe where you can take long safe values on houses, the US dollar, and GE. A universe of steroid-free baseball, apple meaning apple pie and not Apple, where the American flag unites all and where diligent workers design the most difficult and reliable things in the world, as we watch in awe.
GE shares were around $ 30 a share in 2017 and have fallen below $ 8 a few times since, but are now rebounding. An expected explosion in CAPEX spending is pushing the stock up now and they should do well. Indeed, recently, the firm has experienced a strong increase. But stocks are now at levels they were in 2009, and below what they were in 1996.
So the last few years have been appalling for GE. Also, as an accompanying piece to The Economist’s “a Bonanza investment is coming“, you can also read the article from 1996”what happened to the CAPEX boom. “
GE’s market capitalization was over $ 3,981 billion in 2001, $ 161 in 2008, $ 65 in 2018 and is now back to $ 122. Over the past two years, the company has experienced a decline in revenue of more than 16% per year. By selling both the rail and oil and gas units, GE sold two companies that could have benefited tremendously from 3D printing and that could have been part of their internal 3D printed flywheel. So, maybe 3D printing is no longer strategic? Also, the unit for which GE Additive had the closest relationship with the Fantastically Profitable, GE Aviation, is not that hot.
So for GE there are a few obvious choices the conglomerate can make.
- He can hang in there and wait for aviation demand to hopefully bounce back quickly. As demand returns, Aviation’s superior returns will propel the newly resplendent GE into renewed growth as a more focused business. The resulting funding and market success will then allow GE Additive to build better machines that make better parts for the most critical applications, which will drive sales and become a leader in additives.
- He can hang in there and wait for aviation demand to hopefully bounce back quickly. As demand returns, Aviation’s superior returns will propel the newly resplendent GE into renewed growth as a more focused business. The resulting funding and market success will then enable GE Additive to build better machines that make better parts. just for GE itself. It won’t really sell machines, but instead Additive will become a catalyst for aviation.
- It can divest itself of energy, energy and aviation and concentrate on an exclusively medical business.
- It can become a purely medical business and use the proceeds from the divestitures to acquire Philips Medical and other assets to become a leader in medical imaging in particular.
- Can it make some sort of creative change with Siemens to create a combined energy business, a combined medical business and keep aviation?
- Or it can slip into insignificance.
Regardless of the option, it can be tempting to sell GE Additive or even, in the heady days of 3D printing inventory, not parts, to turn GE Additive into a separate public company. This can give the business the cash flow needed to complete some of the above scenarios.
What do you think? Which 3D printing IPOs do you want to see?