3D Systems’ ‘Singular Focus’ on 3D Printing Sees It Selling Simbionix for $ 305 Million
Sold in $ 305 Million Deal, Simbionix to Join Virtual Reality Medical Training Company Surgical Sciences Sweden, where it will complement its portfolio of existing clinical simulation programs. For 3D Systems, he says the move “completes” the restructuring he started last year, in which he divested many of his non-core businesses in order to establish a “singular focus” on 3D printing. .
“Over the past few months, 3D Systems has divested a number of assets that are not critical to our market-leading additive manufacturing solutions business,” said Dr. Jeffrey Graves, President and CEO of 3D Systems. “The latest of these is our Simbionix business, under the leadership of Ran Bronstein, which has built a strong position in the medical simulation, training and robotic surgery market. “
“I believe their [Simbionix’s] the future will be even brighter, with increased scale and an ability to leverage the core strengths of both companies in a growing medical simulation market.
3D Systems’ “strategic refocusing”
When Graves was appointed CEO of 3D Systems in May 2020, the pandemic had just slumped the company’s revenue by 13%, and it continued to decline by 28% in the second quarter of 2020. To stabilize finances of the company, Graves announced that it would quickly undergo a “strategic refocus” in which it would focus on its industrial and medical verticals, and divest any segments that did not meet these criteria.
Since then, 3D Systems has sold its 3D printing software arm Cimatron to technology investment firm Battery Ventures, raising $ 65 million, in addition to its five on-demand manufacturing facilities to a capital company. investment. Trilantic North America, in a deal that provided it with additional funding of $ 82 million.
Using a portion of the capital raised from these disposals, among several others, 3D Systems has also invested in the growth of its core medical and industrial divisions through acquisitions. With this in mind, the company has acquired the manufacturer of bio-printers Allevi as well as the developer of 3D printing software. Additional work, and judging by its recent financial results, its strategy is starting to pay off.
3D Systems recorded its first quarter of annual growth since 2018 through the fourth quarter of 2020, and this trend continued into the first quarter of 2021, although its revenue is still below the levels of the first quarter of 2019. To achieve this, the company has also had to make tough decisions, reducing its workforce by 20% and $ 100 million in operating costs, but is now getting back into a position where it “expects profitability”, both in terms of gross margin and EBITDA.
The sale of Simbionix for 305 million dollars
Subject to closing conditions, the sale of Simbionix is expected to close in August 2021, after which it will become part of Surgical Science, a company listed on the Nasdaq First North Growth Market, with reported annual sales of $ 41 million. dollars.
According to 3D Systems, the acquisition of Surgical Science makes it a “market leader” in the fields of medical simulation and robotic surgery. In particular, the company would view the addition of Simbionix as a way to “complement and strengthen” its endovascular, endoscopic, urologic, orthopedic and ultrasound simulation offerings, and to build a larger network of academic and medical partners.
Regarding the 3D Systems divestiture campaign, the company said the sale of Simbionix “completes the initiative”, which means it may now be over. After focusing on two main business units: healthcare and industrial solutions, the company predicts “strong organic growth” in the future and has even considered investments to “meet growing demand”.
“The proceeds from this sale, combined with the previously announced divestitures, will leave us in a strong position, with a cash balance of approximately $ 500 million and no debt,” added Graves. “With our scale, the breadth of our industry-leading technologies, and an application focus proving effective in accelerating customer adoption of AM, we are uniquely positioned to remain a leader. in industry. “
3D modeling and medical VR
Of course, the loss of 3D Systems is the gain of Surgical Science, and its acquisition should allow the company to better respond to what has become a booming medical education software market. Just last year Realize Medical, which also specializes in clinical 3D modeling, in partnership with Logitech to bring interactivity to its Elucis VR platform.
By taking advantage of the company’s software, users are now able to convert medical images into 3D models, which can be explored and manipulated in a virtual reality environment. These simulation technologies are increasingly finding applications in medical education, alongside more traditional uses of 3D printing, such as creating anatomically relevant patient models.
Due to recent technological advancements, the accuracy and adoption of these 3D printed replicas has continued to grow within the medical industry. While the quality management system (QMS) behind 3D impressions of life ” anatomical models has obtained ISO certification, Mimaki has succeeded in producing clinical models with a whole new “degree of color fidelity”.
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The featured image shows the editor of the 3D printing industry performing surgery with a Simbionix simulator. Photo via the 3D printing industry.