3D Systems Corporation (NYSE:DDD) announced Wednesday that it would acquire Cleveland-based Simbionix for $120 million cash. The announcement came just a day before the 3D printing company reports its second-quarter results. Founded in 1997, Simbionix is a leader in 3D virtual reality surgical simulation and training. 3D Systems expect to close the deal in the next 30 days, subject to customary closing conditions. Upon completion, the deal will be immediately accretive to the Rock Hill-based company’s earnings.
Simbionix a perfect match for 3D Systems
3D Systems CEO Avi Reichental said that Simbionix is a “perfect match” to the company’s healthcare business. Simbionix’s products, technology and domain expertise will help 3D Systems expand its healthcare capabilities from the training room to the operating room. Simbionix CEO Gary Zamler said 3D Systems has exceptional track record in commercializing innovative virtual surgery and medical devices.
The deal comes just four months after 3D Systems acquired Medical Modeling, which provides 3D printed implants and imaging/modeling products. Simbionix’s strong relationships with hospitals, simulation centers and educational institutions in more than 60 countries should help 3D Systems boost sales. The company’s healthcare revenues surged 53% in the first-quarter to $21.7 million.
Zalmer to become VP and General Manager of Simbionix at 3D Systems
3D Systems said Simbionix CEO Gary Zalmer will continue to lead what will become Simbionix Products division of 3D Systems. Zalmer will assume the role of VP and General Manager upon completion of the deal. The company is expected to provide further details of the transaction at its second-quarter earnings call scheduled at 9:00 a.m. ET on July 31.
Analysts have been speculating a big-ticket deal since 3D Systems raised a whopping $317 million in a secondary offering in May this year. 3D Systems has bought dozens of companies over the last few years to expand its business and gain new technologies. Wall Street expects the company’s Q2 earnings to decline from 20 cents last year to 18 cents. However, revenues are expected to soar 34.40% YoY from $120.79 million to $162.28 million.
3D Systems shares inched up 0.20% to $56.18 in pre-market trading Thursday.