Inspired in part by the reverse merger of Markfroged with one, as well as the acquisition of EnvisionTEC by Desktop Metal, and of RPS and Origin by Stratasys, we’ve been brainstorming about the newly hot 3D printing stocks and renewed interest from investors in our markets. Is 2021 going to be a SPACtacular year for us? Here we speculate on some Merger and Acquisitions activity that we’d like to see in 2021.
I’ve gotten a lot of positive feedback on this series, so I’ll continue it with your encouragement. I’m glad people are enjoying my somewhat fanciful, at times humorous but also hopefully insightful look at Mergers and Acquisitions we’d like to see this year. Part One is here, Part Two is here and here is Part 3.
Polymaker & Keene Village Plastics Merge
Polymaker is a large filament manufacturer from China. With a good brand and quality offering, the company is making headway in the direct sales and OEM space. Up against BASF’s ForwardAM and Mitsubishi Chemical would make Polymaker seem like a deer in a whale’s headlights. Or a cruise ship’s headlights.
I’ve always tried to use the example that competing with BASF is like trying to out swim a cruise ship. In the beginning, you’re all, “I’m free, and all the way over here, so far away. I’m quick and versatile and they’re huge and so, so slow.” And then they bear down on you, like a sloth stalking a hummingbird. They’re aiming for you but you’re still so free, so much cooler and so much quicker. They come closer at a snail’s pace and you’re making new great things and they’re so stodgy. And then, in the blink of a month, you’re dazed and confused swimming in effluence made of a million shrimp cocktails as they steam off into the horizon over you. They’re so boring that you forget that they have more PhDs than most countries. The BASF Ludwigshafen main site is ten square kilometers, which is three times the size of Central Park.
Other market participants will need scale and a worldwide reach to stand a chance. That’s where one of the biggest OEM filament producers comes in: Keene Village Plastics. Separately, they’re trophy Elk waiting to be mounted on a BASF wall. But, together, both firms will be able to produce and offer filaments China and the U.S. Polymaker will give Keene a good brand and the combined volume and locations will create a truly global filament company. If they add 3D4Makers or a similar company to get into the ultra-high-end PEEK game and then pick up Korea’s Graphy to make photopolymers, they can be a one-stop-shop with a broad portfolio. They may then be bigger than BASF’s AM Forward and Mitsubishi’s MCPP. At that point, you’ve gone from roadkill to kingmaker in the consumables industry.
Is Covestro or anyone else hungry for volume? PolyKeen would be the logical buy. Want to dominate the consumables industry from a standstill as a new entrant, or want to deliver a knock out blow? PolyKeen it is.
Unilever Buys Novameat, Revo Foods and ShiokMeats
Breakthrough innovation firm Unilever is not actually really innovating much these days. Instead, they’re a hungry hippo that gobbles up startups that got big—buying SmartyPants vitamins, Dollar Shave Club, Liquid I.V. and Seventh Generation. Rather than spending billions on companies that it could have created itself if it were innovative and patient enough, it is overspending to buy brand goodwill, which it is supposed to be good at growing and curating itself.
BeyondMeat and ImpossibleFoods are even bigger threats to the long term viability of Unilever. They prove that innovation can happen in their bailiwick and, furthermore, that people can then turn that into publicly traded firms. What if, this time, for the 3D printed food revolution, they try something different. They buy NovaMeat, Revo Foods (formerly Legendary Vish), and Shiok Meats. NovaMeat is 3D printing cultured meat, while Revo Foods is focusing on salmon, and Shiok on shellfish. All use complementary technologies and will have the same problems scaling up and getting to production.
What if Unilever would purchase them and incubate all three companies and use its prowess to move them into production? It could then harness three innovation streams and three very different teams in becoming a leader in ethical meat and 3D printed meat of several kinds. This is a huge potential market and will have many more products flow from it.
Johnson & Johnson Buys MT Ortho and Adler Ortho
Medical giant Johnson & Johnson has a great interest in 3D printing, through both bioprinting and its orthopedics division. Where ZImmer has done quite a lot with 3D printed orthopedics and Stryker is forging ahead with its mythical 3D printing manufacturing plant in Ireland, J&J may do well to get ahead in a crowded field.
Famously, personalized 3D printed implants may let patients lose less blood because they fit better (the studies were mostly done by companies making them). It’s also likely that the geometric freedom of 3D printing will let you create geometries and performance that you could not have had previously. We know already that the ability to create surface textures that will make 3D printed implants cheaper also make them able to outperform conventional implants. Non-tailored 3D printed implants are being implanted in the tens of thousands.
MT Ortho and Adler Ortho are key innovators in 3D printing orthopedics and in 3D printing in general. Adler has long used 3D printing and has a modular neck system, produces acetabular cups and custom metal implants, and has significant 3D printing implant IP and knowledge. MT Ortho also uses mostly GE Arcam EBM equipment and has innovative products of its own in the shoulder, knee, and hip. Both firms are innovative and fast moving and would give Johnson & Johnson oodles of the AM expertise it lacks.
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