CORE Industrial Partners buys RE3DTECH to better access the “growing high volume market” of 3D printing
Private equity firm CORE Industrial Partners has announced the acquisition of 3D printing service provider RE3DTECH.
Using its portfolio of FFF, DMLS and MJF machines, RE3DTECH is able to create high volume end use parts, which many of its customers apply in demanding fields such as defense, automotive and aerospace industry. By buying the company, CORE Industrial Partners therefore hopes to expand its share of what it sees as an emerging industrial market and establish a “new 3D printing platform”.
“Our investment in RE3DTECH represents an expansion of our thesis in the additive manufacturing sector to meet the growing market of high volume production needs,” said John May of CORE Industrial Partners. “We believe that CORE’s industry expertise and resources will have a tremendous impact on accelerating the growth of the company, both organically and through complementary acquisitions.
CORE’s expanding service offering
Chicago-based CORE Industrial Partners has so far made $ 700 million in capital commitments on behalf of investors, primarily in US manufacturing and industrial technology companies. While some of the companies in this portfolio only market sheet metal fabrication or services based on subtractive technology, many offer to create parts through multiple processes, including 3D printing.
One such company, Fathom, which markets rapid prototyping and low-volume production services, went public last week on the NYSE, which would allow it to raise $ 80 million in funding. Carried out as a Special Purpose Acquisition Company (SPAC) merger, the deal saw many new investors buy shares in the combined company, but CORE Industrial Partners remains its largest shareholder.
The company is also currently an investor in 3DXTECH, manufacturer of the Gearbox HT2 3D printer, developer of carbon fiber filaments and provider of production services. Midwest Prototyping service bureau in July 2021.
The purchase of RE3DTECH by CORE Industrial Partners can therefore be seen as part of an ongoing investment strategy, focused on supporting offices equipped with 3D printing. Regarding his latest deal, one of the company’s partners, Matthew Puglisi, says he was motivated by the impressive growth of RE3DTECH, as well as the rapid production capabilities developed by his team based near Chicago.
“The strong growth of RE3DTECH since its inception is a direct result of the combination of talented employees, breadth of additive manufacturing technologies, design and engineering capabilities, and rapid turnaround times,” added Puglisi. “We look forward to building on the company’s solid foundations to further expand its service offering and geographic reach. “
Acquire a “new 3D printing platform”
With the acquisition of RE3DTECH, CORE Industrial Partners announced the creation of a “New 3D printing platform ”, indicating that it will be traded separately with one of its other related businesses. This platform will be powered by the legacy machine suite from RE3DTECH, known to include the HP 4200, 5200, and 580 printers, as well as Markforged’s X7, Mark 2, and Metal X 3D printers.
As part of the takeover of RE3DTECH, CORE Industrial Partners also acquired its fleet of SLM Solutions SLM 280, EOS EOSINT M 280 and Arcam EBM Q20plus systems. Designed to feature multiple lasers, fully automatic operation and a large build volume of 350mm x 380mm respectively, these machines are designed for throughput oriented 3D printing.
The acquisition of CORE Industrial Partners therefore allows it to inherit significant 3D printing capabilities of DMLS, MJF and carbon fiber reinforced parts, which are currently used not only to create production quality components for customers. aerospace and automotive markets, but also for those operating in the broader field. the industrial, consumer and medical sectors as well.
For RE3DTECH, on the other hand, its chairman Jim Teuber said that the acquisition of CORE Industrial Partners should allow it to leverage the broader resources of its new parent company, as a means of expanding its current service offering.
“RE3DTECH was founded with the mission of providing our customers with customized solutions using the latest cutting edge technologies,” explains Teuber. “Our partnership with CORE will help unlock the resources needed to continue investing in advanced capabilities and further improve our customer value proposition. “
Investments in service offices explode
Investor interest in 3D printing service providers has soared to new heights over the past six months, many of which have chosen to go public through PSPC mergers, with the aim of turning that goodwill into funding for their clients. respective expansions.
In one of these agreements, in July 2021, Fast Radius agreed to partner with ECP Environmental Growth Opportunities, in order to go public on the Nasdaq stock exchange. Upon signing, it was expected that the move would allow the merged company to raise $ 445 million in funding, which has been set aside to help meet its goal of bringing in $ 635 million per year by 2025.
However, not all of these PSPC mergers have raised the capital that they were initially expected. Shapeways, predicted that its IPO would bring in $ 195 million in gross proceeds, but after the deal was closed, it was revealed that the deal only generated $ 103 million. In that case, it could be argued that investor concerns were valid, as Shapeways lowered its guidance for the fiscal year at the end of last year.
Xometry also chose to tap into the growing investor interest in 3D printing in 2021, but went public not through the SPAC mergers becoming ubiquitous in the industry, but through a traditional IPO. In the end, the deal gained even more investor attention than expected, with the company generating $ 252 million in capital instead of the $ 302 million originally planned.
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The image presented shows the RE3DYTECH workshop, with DMLS, FFF and MJF compatible 3D printers. Photo via CORE Industrial Partners.