DEFA14A: Desktop Metal Urges Stockholders to Vote on Nano Dimension Merger Amidst Financial Concerns

Desktop Metal is urging its stockholders to vote in favor of the proposed merger with Nano Dimension, highlighting potential financial risks if the merger is not approved.

Summary

• Desktop Metal is urging stockholders to vote in favor of the proposed merger with Nano Dimension at the special meeting on October 2, 2024.
• Institutional Shareholder Services Inc. (ISS) has recommended that stockholders vote in favor of the merger.
• ISS believes the offer is likely the best available, shareholders are receiving a premium, the implied valuation appears fair, and the cash consideration provides liquidity and immediate value.
• If the merger is not approved, Desktop Metal expects to run out of cash by the end of the first quarter of 2025.
• Failure to approve the merger may require the company to undertake financings that may be severely dilutive or result in a risk of bankruptcy.
• The company filed a proxy statement with the SEC on August 15, 2024, and urges investors to read it carefully.
• The communication contains forward-looking statements involving risks and uncertainties that could cause actual results to differ materially.

Sentiment

Score: 4

Explanation: The sentiment is cautiously negative. While the company is pushing for a merger that ISS supports, the underlying reason is a looming cash shortage and potential bankruptcy if the deal falls through. The forward-looking statements also highlight numerous risks.

Positives

• ISS recommends stockholders vote in favor of the merger.
• ISS believes the offer is likely the best available, shareholders are receiving a premium, the implied valuation appears fair, and the cash consideration provides liquidity and immediate value.

Negatives

• Desktop Metal expects to run out of cash by the end of the first quarter of 2025 if the merger is not approved.
• Failure to approve the merger may require the company to undertake financings that may be severely dilutive or result in a risk of bankruptcy.

Risks

• The ultimate outcome of the proposed transaction between Desktop Metal and Nano is uncertain.
• The announcement of the proposed transaction could negatively affect Desktop Metal's ability to operate its business and retain key personnel.
• The timing of the proposed transaction is uncertain.
• The occurrence of any event, change or other circumstance could give rise to the termination of the proposed transaction.
• The ability to satisfy closing conditions to the completion of the proposed transaction is uncertain.
• Reductions in the Per Share Merger Consideration to be paid based on transaction expenses, potential borrowings under the Bridge Loan Facility and agreements relating to severance for certain executive officers and employees of Desktop Metal.

Future Outlook

The company's future is heavily dependent on the approval of the merger with Nano Dimension, as failure to do so could lead to significant financial challenges, including potential bankruptcy.

Management Comments

• Ric Fulop, Co-Founder, Chairman and Chief Executive Officer of Desktop Metal, urges stockholders to vote in favor of the merger.
• Ric Fulop states that voting is a unique opportunity to make a direct impact on your investment.

Industry Context

The document highlights the importance of mergers and acquisitions in the current market, especially for companies facing financial difficulties. The recommendation from ISS underscores the role of proxy advisory firms in influencing shareholder decisions.

Comparison to Industry Standards

• The document references Institutional Shareholder Services Inc. (ISS), a leading independent proxy voting advisory firm, indicating the importance of third-party assessments in such transactions.
• The mention of potential bankruptcy if the merger fails highlights the financial pressures faced by some companies in the competitive 3D printing industry, where achieving profitability and sustainable growth can be challenging.

Stakeholder Impact

• Shareholders face potential dilution or loss of investment if the merger fails and the company pursues alternative financing or bankruptcy.
• Employees' jobs could be at risk if the company faces financial distress.
• The merger could impact the company's relationships with customers and suppliers.

Next Steps

• Stockholders need to vote on the proposed merger by the special meeting on October 2, 2024.
• Desktop Metal will continue to pursue the completion of the merger with Nano Dimension.

Key Dates

Keywords

merger, Desktop Metal, Nano Dimension, stockholders, proxy statement, vote, cash, bankruptcy, financing