Further speculation swirled that a deal between HP and 3D Systems was a much greater possibility after former HP Vice President of Imaging and Printing Vyomesh Joshi was named as 3D Systems’ new CEO. However, according to Citigroup analyst Kenneth Wong it would be “highly unlikely” for HP to purchase 3D Systems at this point. While in the last few months both 3D Systems and Stratasys seemed to be staging a bit of a comeback, Wong isn’t optimistic about the chances of a buyout. He also doesn’t seem especially impressed with recent stock rebounds for both companies as he downgraded 3D Systems to sell and downgraded Stratasys to neutral.
“(3D Systems) shares have nearly tripled since troughing mid-February and have doubled year-to-date, despite (3D printer) market conditions that remain unsettled. We believe the upside scenarios from operational efficiencies upside to take-out potential are overstated. We expect Joshi to bring a fresh set of eyes to [3D Systems] strategic growth and profit initiatives. Investors believe Joshi’s HP roots enhance the possibility of an HP acquisition of [3D Systems]. While we see how bullish investors might connect the dots here, (we) believe that an acquisition by HP is highly unlikely,” Wong said in a recent research note.
Despite their stock prices jumping, and a renewed focus on the more stable industrial side of 3D printing, 3D Systems and Stratasys both downplayed their recent good fortune, leading many to believe that it is a sign that the rebounding stock prices may be softer than they appear. With HP looking to launch their new 3D printer this year, if they were going to purchase a 3D printing company now would be the ideal time to do it. Both companies could probably be purchased at a bargain price, and HP could really use access to one of the company’s global 3D printer distribution, reseller and service networks.
So what exactly happened? Was there ever a deal being discussed, or was it just rumor and speculation? Or maybe HP thinks that their new Multi Jet Fusion 3D Printer is all that they will need to break into the 3D printing industry, and buying a troubled company would be a bigger drag on the new company than they were willing to risk. But if 3D Systems wasn’t cleaning house for HP, then who else would be willing to buy themselves into the 3D Printing industry? If there is anyone who could use a pre-existing 3D printing company my money would be on Canon, who seems more desperate, and saw much less excitement over their first entry into the 3D printing industry. But whoever it is, if they even exist, it is looking less and less likely that it will be HP Inc. Any ideas? Discuss in the HP Not to Buy 3D Systems forum over at 3DPB.com.
[Source: Engineering.com]