DEFM14A: Nano Dimension to Acquire Desktop Metal in $5.50 Per Share Cash Deal

Desktop Metal stockholders will vote on a proposed merger with Nano Dimension, offering $5.50 per share in cash, subject to certain adjustments.

Summary

• Desktop Metal has entered into a merger agreement with Nano Dimension, where Nano will acquire Desktop Metal for $5.50 per share in cash, subject to adjustments.
• The merger consideration is subject to downward adjustments based on transaction expenses, potential borrowings under a bridge loan facility, and agreements relating to severance for certain executive officers and employees of Desktop Metal.
• Desktop Metal estimates adjustments will total $0.44 per share, resulting in an adjusted consideration of $5.06 per share, but this could range from $4.07 to $5.50 depending on the adjustments.
• The Desktop Metal board has unanimously approved the merger agreement and recommends that stockholders vote in favor of the deal.
• A special meeting of Desktop Metal stockholders will be held on October 2, 2024, to vote on the merger proposal.
• The merger is expected to close in the fourth quarter of 2024, subject to regulatory approvals and other customary closing conditions.
• Key stockholders, representing approximately 15% of the voting power, have entered into voting agreements to support the merger.
• Upon completion of the merger, Desktop Metal will become an indirect, wholly-owned subsidiary of Nano Dimension and its stock will be delisted from the NYSE.

Sentiment

Score: 7

Explanation: The document is a formal proxy statement, so the language is generally neutral. However, the board's recommendation to vote in favor of the merger and the potential benefits of the transaction suggest a moderately positive outlook.

Positives

• The merger provides Desktop Metal stockholders with a cash payment for their shares.
• The merger consideration represents a premium over Desktop Metal's recent trading price.
• The Desktop Metal board believes the merger is in the best interests of the company and its stockholders.
• Key stockholders have agreed to support the merger, increasing the likelihood of approval.

Negatives

• The merger consideration is subject to downward adjustments, potentially reducing the final amount received by stockholders.
• If the merger is not completed, Desktop Metal will remain a public company, but its stock price could decline.
• The merger will result in Desktop Metal ceasing to be a publicly traded company.
• Executive officers and directors of Desktop Metal may have interests in the merger that are different from those of stockholders generally.

Risks

• The merger may not be completed if the required regulatory approvals are not obtained.
• The merger agreement may be terminated under certain circumstances, including a superior proposal or a material breach.
• The adjustments to the merger consideration are not known with certainty and could reduce the final amount received by stockholders.
• Litigation relating to the merger could delay or prevent the transaction from closing.
• The restrictions placed on Desktop Metal's business activities during the pendency of the merger could affect its financial performance.

Future Outlook

Desktop Metal expects the merger to close in the fourth quarter of 2024, subject to regulatory approvals and other customary closing conditions.

Management Comments

• The Desktop Metal board has unanimously approved the merger agreement and recommends that stockholders vote in favor of the deal.

Industry Context

The announcement notes that the industrial additive manufacturing sector is undergoing a cyclical downturn, and consolidation is seen as a way for companies to achieve scale and generate cash flow.

Comparison to Industry Standards

• The document references Stratasys Ltd. as a comparable company, noting Desktop Metal's previous merger agreement with them.
• The document references Kornit Digital Ltd., 3D Systems Corporation, Velo3D, Inc., Markforged Holding Corporation, and Prodways Group SA as comparable companies in the additive manufacturing segment.

Legal Proceedings

• Desktop Metal and members of its board of directors have been named as defendants in a complaint filed by a purported stockholder of the Company.
• The complaint challenges the adequacy of disclosures in the preliminary proxy statement and seeks injunctive relief preventing the parties from proceeding with the Merger, among other remedies.
• Desktop Metal has also received several demand letters from purported stockholders making similar allegations.

Stakeholder Impact

• Desktop Metal stockholders will receive $5.50 per share in cash, subject to adjustments.
• Desktop Metal employees will be subject to employment matters outlined in the agreement.
• The merger will result in Desktop Metal becoming a wholly-owned subsidiary of Nano Dimension.

Next Steps

• Desktop Metal will hold a special meeting of stockholders on October 2, 2024, to vote on the merger proposal.
• Desktop Metal and Nano will seek to obtain the required regulatory approvals.
• Desktop Metal and Nano will work to satisfy the other closing conditions outlined in the merger agreement.

Key Dates

Keywords

merger, acquisition, Desktop Metal, Nano Dimension, stockholders, merger agreement, cash consideration, regulatory approvals, special meeting, stock