DM
Desktop Metal, INC
NYSE
DEFA14A: Desktop Metal Urges Stockholders to Approve Nano Dimension Merger Amidst Financial Concerns
Sentiment:
Proxy Statement
6 September 2024 4:38 PM
Desktop Metal is urging its stockholders to vote in favor of the proposed merger with Nano Dimension, citing financial difficulties and limited alternatives.
Worse than expected
Desktop Metal expects to run out of cash by the end of the first quarter of 2025 if the merger is not approved.
Summary
- Desktop Metal is urging stockholders to vote FOR the proposed merger with Nano Dimension Ltd.
- The Board of Directors believes the merger is the best and only viable option for stockholders.
- The merger consideration is all-cash and expected to represent a significant premium to the trading price before the merger announcement.
- Desktop Metal expects to run out of cash by the end of the first quarter of 2025.
- The company is soliciting votes for the Special Meeting on October 2nd.
- If stockholders do not vote, it has the same effect as voting against the transaction.
Sentiment
Score: 3
Explanation: The sentiment is low due to the company's precarious financial situation and reliance on the merger for survival. While the all-cash deal is a positive, the overall tone is one of urgency and concern.
Positives
- The merger consideration is all-cash.
- The merger is expected to represent a significant premium to the trading price before the merger was announced.
Negatives
- Desktop Metal expects to run out of cash by the end of the first quarter of 2025 if the merger is not approved.
- Valuations for most publicly traded additive manufacturing companies have contracted as much as 95% since their all-time highs.
Risks
- The ultimate outcome of the proposed transaction is uncertain, including the possibility that Desktop Metal's stockholders will reject the proposed transaction.
- The announcement of the proposed transaction could negatively affect Desktop Metal's ability to operate its business and retain key personnel.
- Transaction expenses could be higher than expected, or Desktop Metal may have to borrow money from Nano, which would decrease the merger consideration.
- The ability to satisfy closing conditions to the completion of the proposed transaction is not guaranteed.
Future Outlook
The document focuses on the proposed merger with Nano Dimension and its potential impact on Desktop Metal's financial viability. The company's future is heavily dependent on the successful completion of the merger.
Management Comments
- Ric Fulop, Co-Founder, Chairman and Chief Executive Officer of Desktop Metal, urges stockholders to protect the value of their investment and support the merger.
- The Board of Directors believes the merger with Nano Dimension is the best and only viable option for stockholders.
Industry Context
The document notes that valuations for most publicly traded additive manufacturing companies have contracted significantly, highlighting the challenges faced by companies in this sector and the potential need for consolidation.
Comparison to Industry Standards
- The document mentions that valuations for most publicly traded additive manufacturing companies have contracted as much as 95% since their all-time highs, indicating a broad industry trend.
- It suggests that few financing alternatives exist for many of these companies outside consolidation, implying that Desktop Metal's situation is not unique within the industry.
Stakeholder Impact
- Stockholders face the risk of losing their investment if the merger is not approved and the company runs out of cash.
- Employees' jobs are potentially at risk if the company's financial situation does not improve.
- The merger could impact the company's relationships with customers and suppliers.
Next Steps
- Stockholders need to vote on the proposed merger by the October 2nd Special Meeting.
- Desktop Metal will continue to operate its business while awaiting the outcome of the vote.
Key Dates
- December 31, 2023: End of Nano Dimension's fiscal year, reference to their Annual Report on Form 20-F.
- December 31, 2023: End of Desktop Metal's fiscal year, reference to their Annual Report on Form 10-K.
- August 15, 2024: Desktop Metal filed the Proxy Statement with the SEC.
- September 6, 2024: Date of the communication sent to Desktop Metal stockholders urging them to vote for the merger.
- October 2, 2024: Date of the Special Meeting of Desktop Metal stockholders to vote on the proposed merger.
- End of Q1 2025: Desktop Metal expects to run out of cash by this time if the merger is not approved.
Keywords
merger, Nano Dimension, Desktop Metal, stockholders, cash, additive manufacturing, proxy statement, vote
DM
Desktop Metal, INC
NYSE
Sector: TBD
Filings with Classifications
Worse than expected
26 March 2025 5:20 PM
8-K Filing
- Revenue decreased from $189.7 million to $148.8 million year-over-year.
Worse than expected
31 October 2024 7:00 AM
Quarterly Report
- The company's revenue decreased by 15% year-over-year.
- The company reported a net loss of $35.4 million for the quarter and $191.0 million for the first nine months.
- The company's gross margin, while improved, is still relatively low at 9%.
Capital raise
31 October 2024 7:00 AM
Quarterly Report
- The company may need to raise additional capital through arrangements with Nano or from other sources, including equity and debt financings.
- The company has a multi-draw term loan credit facility with Nano for up to $20 million, available after January 7, 2025.
- The company may need to issue additional shares of capital stock or offer debt or other equity securities if the merger is not completed.
Worse than expected
23 September 2024 4:24 PM
Proxy Statement
- The company warns of potential dilutive financings or bankruptcy if the merger fails.
- Desktop Metal expects to run out of cash by the end of the first quarter of 2025 if the merger is not approved.
Worse than expected
13 September 2024 4:02 PM
Proxy Statement
- The company expects to run out of cash by the end of the first quarter 2025 if the merger is not approved.
- The company may need to undertake financings that may be severely dilutive to stockholders if the merger is not approved.
- There is a risk of bankruptcy if the merger is not approved.
Capital raise
13 September 2024 4:02 PM
Proxy Statement
- The document mentions that if the merger is not approved, Desktop Metal may need to undertake financings.
- These financings may be severely dilutive to stockholders.
Worse than expected
6 September 2024 4:38 PM
Proxy Statement
- Desktop Metal expects to run out of cash by the end of the first quarter of 2025 if the merger is not approved.
Capital raise
15 August 2024 7:00 AM
Definitive Proxy Statement
- The merger agreement includes a provision for a multi-draw term loan credit facility (Bridge Loan Facility) from Nano to Desktop Metal, up to $20 million, to provide working capital and liquidity.
Worse than expected
31 July 2024 4:15 PM
Earnings Conference Call Transcript
- The company's Q2 2024 revenue was down compared to the previous year.
- The company's non-GAAP gross margins were down compared to the previous year.
- The company's adjusted EBITDA was negative.
Capital raise
30 July 2024 4:53 PM
Quarterly Report
- The company plans to raise additional capital through a combination of potential options, including equity and debt financings.
- Nano Dimension agreed to provide a multi-draw term loan credit facility in an aggregate principal amount not to exceed $20.0 million, subject to certain conditions.
Worse than expected
30 July 2024 4:53 PM
Quarterly Report
- The company's revenue decreased by 27% compared to the same quarter last year.
- The company's gross margin was -83%, indicating significant losses on sales.
- The company's net loss increased significantly compared to the same quarter last year.
Worse than expected
30 July 2024 4:36 PM
Quarterly Report
- Revenue decreased from $53.3 million to $38.9 million compared to the same quarter last year.
- The company reported a net loss of $(103.4) million.
Worse than expected
30 July 2024 4:35 PM
Quarterly Report
- The company's revenue decreased significantly year-over-year.
- The company reported a substantial net loss, primarily due to one-time non-cash charges.
- The company's GAAP gross margin was negative, indicating poor profitability.
Worse than expected
3 July 2024 4:24 PM
Merger Announcement
- The combined company expects negative cash flow for the next six to eight quarters.
Delay expected
3 July 2024 4:24 PM
Merger Announcement
- The transaction is expected to close at the end of the year, but based on delays, maybe a few months later.
Capital raise
3 July 2024 7:32 AM
Merger Announcement
- Nano Dimension has committed to providing Desktop Metal with a $20 million secured loan facility if the closing of the transaction extends into 2025.
- The purchase price may be adjusted based on the amount drawn from the loan facility prior to closing.
Worse than expected
3 July 2024 7:32 AM
Merger Announcement
- The final purchase price is subject to downward adjustments based on transaction expenses and potential draws on a loan facility, which could reduce the value of the deal for Desktop Metal shareholders.
Delay expected
3 July 2024 7:32 AM
Merger Announcement
- The closing of the transaction is expected in the fourth quarter of 2024, but is subject to customary closing conditions, including regulatory approvals, which could cause delays.
Worse than expected
9 May 2024 6:02 AM
Quarterly Report
- The company's revenue decreased by 2% year-over-year, indicating worse than expected sales performance.
- The company reported a gross loss of $2.2 million, indicating worse than expected profitability.
- The company's net loss of $52.1 million was significant, indicating worse than expected financial results.
Capital raise
9 May 2024 6:02 AM
Quarterly Report
- The company entered into an Open Market Sale Agreement with Cantor Fitzgerald & Co. to sell shares of common stock for an aggregate offering price of up to $75.0 million.
- The company may need to further increase its capital resources by issuing additional shares of its capital stock or offering debt or other equity securities.
Better than expected
9 May 2024 6:00 AM
Quarterly Report
- The company's adjusted EBITDA improved by 44% year-over-year, indicating better than expected cost management.
- Non-GAAP operating expenses decreased for nine consecutive quarters, showing better than expected cost control.
- Cash consumption decreased by 47% year-over-year, demonstrating better than expected cash management.
Capital raise
23 April 2024 7:15 AM
Proxy Statement
- The company may offer common and preferred stock, debt securities, warrants, and units of up to $250.0 million in the aggregate under a shelf registration statement.
- The company may sell shares of its Class A common stock having aggregate sales proceeds of up to $75.0 million pursuant to an at the market offering program.
- The company intends to raise capital through equity or debt financing to fund its current operations.
Worse than expected
23 April 2024 7:15 AM
Proxy Statement
- The company needs to implement a reverse stock split to regain compliance with the NYSE minimum bid price requirement, indicating that the share price has fallen below acceptable levels.
Capital raise
15 March 2024 4:12 PM
Annual Results
- The company may need to further increase its capital resources by issuing additional shares of its capital stock or offering debt or other equity securities.
- The company may not be able to obtain additional financing on terms favorable to it, if at all.
Worse than expected
15 March 2024 4:12 PM
Annual Results
- The company experienced a net loss of $323.3 million in 2023, which is worse than the previous year.
- The company's revenue decreased by 9% in 2023 compared to 2022.
- The company's gross profit decreased by $25.2 million in 2023 compared to 2022.
Better than expected
15 March 2024 7:00 AM
Quarterly Report
- The company's net loss significantly decreased year-over-year, indicating improved financial performance.
- Adjusted EBITDA showed a substantial improvement, reaching the company's strongest quarterly performance to date.
- Non-GAAP gross margins improved significantly year-over-year.
Worse than expected
24 January 2024 8:05 AM
Strategic Business Review
- The company is implementing a significant workforce reduction and restructuring plan, indicating that the current financial performance is worse than expected.
- The company is facing a downturn in the additive manufacturing industry and a softer demand environment, which are contributing to the need for these cost-cutting measures.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.