3D Systems shares rallied 4.44% on Monday after the company announced the acquisition of Chinese prototyping firm Easyway Design and Manufacture Co. The Rock Hill-based company said the purchase also includes Easyway’s wholly-owned subsidiaries comprising the Easyway Group.
Easyway the cornerstone for 3D Systems’ China plans
3D Systems also announced the formation of 3D Systems China, headed by Easyway founder May Zhou. Terms of the deal were not disclosed. Easyway is a 3D printing sales and service provider with operations in Beijing, Shanghai, Guangdong, Wuxi and Chongqing. It has customers in the Chinese medical, automobile and consumer goods industries.
Morningstar Investment Conference: Using Annuities In A Portfolio For Added Stability
Easyway’s clients include Nissan Motor, Volkswagen, Philips, Panasonic, Omro, and Stanley Black & Decker. It has substantial service bureau production capabilities, and an extensive China sales and service coverage. Besides, 3D Systems is likely to benefit from cheaper manufacturing costs in China. It will also have a new avenue to boost growth.
3D Systems CEO Avi Reichental indicated that the company could make some more strategic acquisitions in China. He said Easyway represented the “cornerstone of our expansion plans for China.” The deal gives 3D Systems a strong platform to scale its Quickparts custom manufacturing operations. Quickparts provides online quotes and manufactures functional, 3D-printed end-use parts instantly.
3D Systems hungry for acquisitions
3D Systems has been growing largely through acquisitions to retain its leadership position. But its extreme diversification has raised concerns among investors. 3D Systems has said that it would slow down the acquisition pace later this year to fine tune its investments. Last summer, it acquired Belgian metal printing service bureau LayerWise.
In January, the Rock Hill-based company purchased London-based botObjects to bolster its printer lineup. 3D Systems completed the $97 million acquisition of Cimatron in February. It has acquired more than 50 firms in the last few years.
3D Systems shares fell 1.29% to $28.30 in pre-market trading Tuesday. The stock has declined more than 48% in the last 12 months.