Sep 7, 2016 | By Nick
Major moves by GE, Siemens and Concept Laser have produced a ripple effect throughout the 3D printing industry and the spotlight is on the sector that some experts finally believe is hitting maturity.
GE has launched a $1.4 billion takeover bid for both Arcam AB and SLM Solutions in a bid to strengthen its 3D printing arsenal. GE intends to be a driving force in this fledgling sector and it wants to build a $1 billion a year 3D printing business by 2020.
Siemens wants a piece of the action, too, and recently acquired an 85% stake in Material Solutions in the UK. Concept Laser, on the other hand, is looking for a buyer. Now could be the perfect time to sell on the back of its best ever year as the likes of GE don't seem scared off by high prices.
The GE takeovers have sent a seismic wave through the entire industry. 3D Systems Group stock rose by 7.2%, Stratasys Ltd increased by 6.7% and Voxeljet AG jumped by 9.2% on the New York Stock Exchange. Somewhat perversely, GE shares fell 1.3% to $30.88.
The experts say this is a clear sign of the 3D printing industry hitting maturity. Now that the major players are stepping in to take a slice of the supply chain, we could finally see the world make the switch and use 3D printing as the manufacturing tool that the minority always knew it could be. Gartner Research Vice President Pete Basiliere told CRN: "The extended presence of GE and Siemens, both of which already had a presence in the market, is indicative of how 3D printing has moved mainstream within enterprises," Basiliere said.
"The market for metal printers in particular is very strong, as more and more metals are qualified for use in finished goods, be that not only aircraft parts and gas turbines, as in the case of GE, or medical implants, such as the ones Arcam technology has enabled."
The theory is that GE's aggressive strategy could spark a goldrush of acquisitions in the 3D printing industry. That's because companies that once bought one or two 3D printers for prototyping purposes could well need a mass of them to cover their actual manufacturing process. Concept Laser, with an array of top class industrial 3D printers and another system on the way that it calls the "AM factory of tomorrow," could be perfectly positioned. It still may opt not to sell, but it is exploring the possibilities and it looks like prime real estate in the current environment.
GE has embraced 3D printing as a client and opened the Center for Additive Technology Advancement (CATA) in Pittsburgh in April. It installed ExOne 3D printers and has worked on both hardware and software at the cutting edge facility. That hardware includes new components for GE Aviation, including lightweight fuel nozzles that are stronger and more efficient than the traditionally manufactured alternatives and that is just the start. It intends to sell 40,000 of these to a variety of aircraft manufacturers by 2020.
Arcam AB is a Swedish company with its own high-end electron beam melting 3D printer, which also produces a large number of advanced metal powders for the aerospace and medical industries. It is the parent company of AP&C, which is a metal powders company based in Canada, and DiSanto Technology. This medical 3D printing firm is based in Connecticut and the three companies generated $68 million in 2015.
SLM Solutions Group is based in Lubeck, Germany and is another manufacturer of laser 3D printers for additive manufacturing. It services mostly commercial customers in the aerospace, healthcare, automotive and energy industries.
The industrial giant is prepared to spend $1.4 billion to bring both companies under the watchful eye of GE Aviation, which has invested heavily in 3D printing in recent times.
The takeover of SLM Solutions Group has not been given the green light as yet, but the board is expected to support the move and investors have been offered $43 a share. It offered $680 million for Arcam, which worked out at $33.65 a share. That's 53% more than the company's closing price on Monday.
“Additive manufacturing is a key part of GE’s evolution into a digital industrial company,” said Jeff Immelt, Chairman and CEO of GE. “We are poised to not only benefit from this movement as a customer, but spearhead it as a leading supplier.
“Additive manufacturing will drive new levels of productivity for GE, our customers, including a wide array of additive manufacturing customers, and for the industrial world.”
GE had already pumped more than $1.5 billion into additive manufacturing before these latest takeovers were announced and held more than 340 patents for metal powders. Both numbers will now swell by a significant margin and its clear to see that GE wants to become a global leader in 3D printing on a commercial level.
The company claims it will save $3-5 billion in the next 10 years as it cuts the cost of manufacture. That's before it gets into the profits to be made from contract manufacturing and selling its own products.
We’ve been waiting for this tipping point for years and now the technology, infrastructure and supply chain are finally falling in to place. Advances in material science, faster printers and support from heavyweight global corporations should give smaller firms the confidence to switch to 3D printing for their production and there's a general feeling that the tipping point is coming.
GE is perfectly positioned to become a global force in this new industrial revolution and Siemens is determined to buy a spot at the head table.
Posted in 3D Printing Application
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