ORIGIN, a Stratasys company?
As part of an acquisition of over $100 million, including cash and stock, Stratasys has announced its intent to acquire 3D printing start-up Origin Inc. The US-based company is acknowledged for the development of a resin-based Programmable PhotoPolymerization (P3) technology.
This means that Origin’s proprietary Programmable PhotoPolymerization (P3) technology would be an important growth engine for Stratasys, adding up to $200 million incremental annual revenue within five years. We can therefore expect to see a stronger Stratasys in polymers and production applications of 3D printing in industries such as dental, medical, tooling, and select industrial, defense, and consumer goods segments.
Origin within the AM industry
Like most AM companies, Origin has strengthened the capabilities of its technology through collaborations with other industry players. Remember the company’s collaboration with DSM? However, a first alliance with Stratasys has been observed during the peak of the Covid-19 pandemic. Both companies provided Healthcare Specialists Millions of 3D-Printed Nasopharyngeal Swabs for COVID-19 Testing.
More recently, we saw an application of the PhotoPolymerization technology during the U.S. Air Force Rapid Sustainment Office’s (RSO) inaugural Advanced Manufacturing Olympics. As part of this competition, Origin, Stress Engineering Services and nTopology have developed a 3D printed multi-material F-16 hydraulic tube clamp.
About the potential acquisition
The manufacturer states that, the total consideration for the transaction is comprised of $60 million paid on closing ($6 million of which is subject to the founders’ retention over 3 years) and $40 million that is subject to performance-based earnouts over 3 years. The acquisition will be paid using a combination of stock of approximately $45 million and cash of approximately $55 million at closing and throughout the earnout period. Approximately $32 million of the cash expenditure will be at closing. The acquisition is expected to accelerate Stratasys’ growth rate and be slightly dilutive to non-GAAP earnings per share in 2021, and accretive to Stratasys’ non-GAAP earnings per share by 2023. The Origin team will join Stratasys and lead the development of its technology and product platform, with a full global launch via the Stratasys go-to-market organization towards mid-2021.
“Our customers are looking for additive manufacturing solutions that enable use of industrial-grade resins for mass production parts with process and quality control,” said Stratasys CEO Yoav Zeif. “We believe Origin’s software-driven Origin One system is the best in the industry by combining high throughput with incredible accuracy. When combined with Origin’s extensive materials ecosystem and our industry-leading go-to-market capabilities, we believe we will be able to capture a wide range of in-demand production applications on a global scale. Together with our intended entry into powder bed fusion technology, the acquisition of Origin reflects another step in fulfilling our objective to lead in polymer additive manufacturing by offering comprehensive, best-in-class technologies and solutions to create a fully digital additive value chain, designed for Industry 4.0 integration.”
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