GE abandons €683 mn takeover of German 3D printer maker SLM Solutions

27 Oct 2016

General Electric (GE) yesterday abandoned its €683 million ($762 million) takeover offer for German 3D printer maker SLM Solutions Group after activist hedge fund Elliott Management Corp opposed the deal.

In early September GE struck a deal to buy two European 3D printing groups - Sweden's Arcam and Germany's SLM Solutions - for a total of $1.4 billion, in order to accelerate its pace in the digital industrial space. (See: General Electric to buy two European 3D printing firms for $1.4 bn) GE had offered to pay €38 per share, and has already agreed to buy 31.5 per cent shares from major shareholders.

The offer was subject to GE securing 75 per cent of the SLM Solutions' shares.

Elliott Management is the second-largest shareholder in SLM Solutions and the fourth-largest shareholder of Swedish 3D-printer maker Arcam.

With its more than 20 per cent in SLM Solutions, Elliott Management is using this as a leverage in blocking the deal in a bid to extract a better offer, although GE's €38 per share offer was a 37-per cent premium over the closing price the day prior to the original announcement.

GE refused and said it had no intention of sweetening the offer further, nor would it extend the deadline.

GE yesterday said that the minimum acceptance threshold wasn't met before the offer expired on Monday.

Elliott Management is also likely to disrupt the GE- Arcam deal in where it holds a 10.14-per cent in the Swedish company and it is unlikely GE could meet the threshold of at least 90 per cent of shareholders accepting a deal, although GE has extended the terms of the takeover proposal to 1 November.

But under the Swedish law, GE could still go ahead and purchase the tendered shares, even if it has not reached the 90 per cent threshold.