Catching up: AspenTech+Emerson, 3D printing, Geomagic

I’ve been neck-deep in earnings news lately —need to find the time to post longer recaps of PLMish ones— and the general sentiment isn’t too upbeat. Nothing horrible, but a lot of spending sounds like it’s on hold, with some recovery expected in the second half of the year. There are pockets of growth (data centers! AI!) but investments in general seem muted. Not surprising, really, when the threat/imposition/retraction of tariffs makes it challenging to project out with any kind of confidence.

But while earnings continue, there’s a lot of other stuff going on, too:

AspenTech announced results but didn’t hold a call —read about that here: https://ir.aspentech.com/node/23231/pdf  — but the news is all about Emerson’s acquisition of the shares of AspenTech it doesn’t already own. Recall that Emerson’s last offer was for $265/share. On Friday, activist shareholder Elliott Management said it now owns 9% of AspenTech shares, making it AspenTech’s largest minority shareholder. Why tell us this? Because Elliott believes Emerson’s bid is too low. Since Emerson’s offer was contingent upon a majority of the minority stockholders tendering their shares, this is a problem. I think Elliott now owns about 40% of the shares that must be sold to Emerson for the deal to conclude. Today, Emerson said that $265 was its “best and final price” and pointed out that this “was actively negotiated over a period of almost three months between Emerson and the AspenTech Special Committee.” It wasn’t shy in defending its offer: “Emerson believes that the AspenTech Special Committee, comprised of three AspenTech independent directors [which negotiated the deal-Ed.], has significantly greater knowledge of AspenTech and its outlook than a short-term stockholder who has acquired stock in AspenTech for the purpose of merger arbitrage.” This isn’t over. If you’re interested, Elliott pressured Honeywell split itself in three – read about that here – and may see itself as unstoppable right now.

Remember the 3D printing saga from last year, when Nano Dimension, Markforged, Desktop Metal, and Stratasys were in a weird 4-way tango about who would acquire whom? In September, Nano announced that it would acquire Markforged then in October, that shareholders had finally approved Nano’s acquisition of Desktop Metal. Both of those deals are still in progress, but may be stalled because they still have to secure regulatory approvals (and Desktop Metal has sued Nano, claiming Nano hasn’t tried hard enough to obtain those approvals). Anyway, Stratasys has decided to leave the drama behind. Last week, Stratasys said that it closed a $120 million investment from Fortissimo Capital, a private equity fund, in exchange for 14% of Stratasys shares. Fortissimo already held 1.5% of Stratasys shares; this investment boosts its ownership to 15.5%. That’s more than Nano owned during its takeover bid and seems to me to signal that Stratasys would not welcome more attention from Nano, even if Nano cleans up its own house first.

And one last acquisition to tell you about: 3D Systems sold Geomagic to Hexagon, where it will find a home in the Manufacturing Intelligence division. Geomagic has been around since the 1990s, creating CAD models by converting 3D scan data. It was the coolest tech in the CAD world in the early 2000s and was female-led, which was rare in the tech world at that time. Geomagic was acquired by 3D Systems in 2013 and probably wasn’t invested in as it should have been. Nevertheless, it is still around, with about 100 employees. Hexagon says the combination with Geomagic will “will further strengthen our market leadership in 3D metrology and reengineering, demonstrating our commitment to deliver increasingly user friendly tools capable of executing complex tasks, so our customers can bring innovative, high quality products to the market at speed and with confidence.” Hexagon will pay a purchase price of $123 million for the Geomagic software business, which generated revenues of around $30 million in 2023. The transaction is expected to close in the second quarter of 2025.

It’s great to see Geomagic valued, once again. To see Stratasys bolster its position to control its own future (which may include a merger, but on its terms, not an outsider’s). And well just have to wait and see what happens with Elliott, AspenTech and Emerson. And tariffs. (PS: It’s still the Gulf of Mexico.)