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Will HP be Purchasing 3D Systems? A Citigroup Analyst Says Probably Not

by • April 29, 2016 • No Comments

3dp_memjetlawsuit_HP_logoThere have been rumors swirling around for approximately a year which HP Inc., the 3D printing half of the company which utilized to call itself Hewlett Packard, may be purchasing a sizeable 3D printing company. The thought makes a lot of sense; the newly created HP may quite use a win this early in the game, and they have hung a lot of the new company’s great results on the creation of their new 3D printing division. Meanwhile, industry leaders 3D Systems and Stratasys have been on the ropes since 2015 when their stock prices tanked, and both companies may be a bargain for a sizeable corporation like HP. In fact, in the past both 3D Systems and Stratasys have been the subjects of rumors which they may be purchased by HP.

3D Systems new President and CEO Vyomesh Joshi.

3D Systems new President and CEO, and former HP Vice President of Imaging and Printing, Vyomesh Joshi.

Further speculation swirled which a deal between HP and 3D Systems was a much greater possibility after former HP Vice President of Imaging and Printing Vyomesh Joshi was named as 3D Systems’ new CEO. But, according to Citigroup analyst Kenneth Wong it may be “highly unmost likely” for HP to purchase 3D Systems at this point. Whilst in the last few months both 3D Systems and Stratasys seemed to be staging a bit of a comeback, Wong is not optimistic of the chances of a buyout. He in addition does not seem especially impressed with new stock rebounds for both companies as he downgraded 3D Systems to sell and downgraded Stratasys to neutral.

“(3D Systems) shares have only about tripled since troughing mid-February and have doubled year-to-date, despite (3D printing device) market conditions which stay unsettled. We believe the upside scenarios of operational efficiencies upside to take-out future are overstated. We assume Joshi to bring a fresh set of eyes to [3D Systems] strategic growth and profit initiatives. Investors believe Joshi’s HP roots enhance the possibility of an HP acquisition of [3D Systems]. Whilst we see how bullish investors can connect the dots here, (we) believe which an acquisition by HP is highly unmost likely,” Wong said in a new research note.

Not so swift.

Not so swift.

Despite their stock prices jumping, and a renewed focus on the additional stable industrial side of 3D printing, 3D Systems and Stratasys both downplayed their new great fortune, major most to believe which it is a sign which the rebounding stock prices may be softer than they appear. With HP appearing to commence their new 3D printing device this year, if they were going to purchase a 3D printing company now may be the thoughtl time to do it. Both companies may most most likely be purchased at a bargain price, and HP may quite use access to one of the company’s global 3D printing device distribution, reseller and service networks.

3D_Systems_Logo_-_of_CommonsRumors like these rarely begin in a vacuum. It is most likely which HP has in the past considered purchasing their way into the industry, and 3D Systems was unquestionably lat any timeaging themselves to be considered for a buyout of someone. There may honestly be no other reason for the company to wait so long to hire their new CEO, and shedding massive departments and staff can easily be perceived as reducing the company’s expenses to appear advantageous for future investors. And dumping their underperforming computer 3D printing device division, despite widely being seen as a wise move, was drastic. It was approximately as if they were attempting to clean the place up and leave it open for someone with adequate cash to come calling.

Maybe me?

Maybe me?

So what precisely happened? Was there at any time a deal being discussed, or was it only rumor and speculation? Or perhaps HP thinks which their new Multi Jet Fusion 3D Printer is all which they can require to break into the 3D printing industry, and buying a troubled company may be a bigger drag on the new company than they were caning to risk. But if 3D Systems wasn’t cleaning house for HP, and so who else may be caning to buy themselves into the 3D Printing industry? If there is anyone who may use a pre-existing 3D printing company my money may be on Canon, who appears additional desperate, and saw much less excitement over their initially entry into the 3D printing industry. But whoat any time it is, if they actually exist, it is appearing less and less most likely which it can be HP Inc. Any thoughts? Discuss in the HP Not to Buy 3D Systems forum over at 3DPB.com.

[Source: Engineering.com]