Acquisitions

12 Months Ended

Dec. 31, 2021

Business Combination and Asset Acquisition [Abstract]

On November 1, 2021, we acquired Oqton, Inc. (“Oqton”), for $188,168, excluding customary closing adjustments. $107,471 paid in cash and the issuance of 2,553 shares of the Company’s common stock having a fair value at the date of issuance of $80,697. The acquisition’s near term impact on the Company’s results of operations and cash flows are expected to be dilutive. Oqton's operating results will be reported in the Industrial segment. We incurred approximately $1,458 of acquisition related expenses.

Oqton is a software company that creates an intelligent, cloud-based Manufacturing Operating System (MOS) platform tailored for flexible production environments that increasingly utilize a range of advanced manufacturing and automation technologies, including additive manufacturing (AM) solutions, in their production workflows. The cloud-based solution leverages the Industrial Internet of Things, artificial intelligence, and machine learning technologies to deliver a solution for customers to automate their digital manufacturing workflows, scale their operations and enhance their competitive position. The Oqton acquisition will allow the Company to expand its existing additive manufacturing software suite to the entire additive industry.

We accounted for the Acquisition using the acquisition method as prescribed by Accounting Standards Codification (ASC) 805 Business Combinations. In accordance with valuation methodologies described in ASC 820 Fair Value Measurement, the acquired assets and assumed liabilities were recorded at their estimated fair values at as of the date of acquisition.

Shown below is the preliminary purchase price allocation, which summarizes the fair value of the assets and liabilities assumed, at the date of acquisition:


Current assets, including cash acquired of $3,454			$	4,462
Intangible assets:
Product technology	$	11,200
Trade name	6,800
Total intangible assets			18,000
Goodwill			167,576
Other assets			855
Liabilities:
Accounts payable and accrued liabilities	$	2,235
Deferred revenue	490
Total liabilities			2,725
Net assets acquired			$	188,168

On December 1, 2021, we acquired Volumetric Biotechnologies, Inc. (“Volumetric”), for $40,172 of which $24,814 was paid in cash and the remainder was paid via the issuance of 720 shares of the Company's common stock having a fair value on the date of issuance of $15,358. Additional payments of up to $355,000 are possible which are linked to the attainment of seven non-financial milestones through December 31, 2030 and 2035 and continued employment of certain key individuals from Volumetric. Any additional payments made will be paid approximately half in cash and half in shares of the Company’s common stock. The additional payments are considered compensation expense which will be recorded ratably from the time a milestone is deemed probable of achievement to the estimated time of achievement. Any compensation expense recorded will be reversed if the milestone is no longer probable of achievement. As of December 31, 2021, one of the seven milestones are considered probable of achievement for which $1,326 of expense was recorded in 2021. Volumetric will be part of the Healthcare reporting unit and segment. The acquisition’s near-term impact on the Company's results of operations and cash flows are expected to be dilutive. The impact of potential share issuance related to the achievement of milestones is not included in dilutive shares until the milestone is met. We incurred approximately $1,200 of acquisition related expenses.

Volumetric’s mission is to develop the ability to manufacture human organs using bioprinting methods and the underlying technologies required to create these highly complex biological structures. With this acquisition, 3D Systems will expand our capabilities and capacity in 3D printing related to bio-printing and regenerative medicine. Combining 3D Systems regenerative medicine group with Volumetric’s highly complementary skill sets of biological expertise and cellular engineering is expected to accelerate our core regenerative medicine strategies which include the bio-printing of human organs, additional non-organ applications and bio-printing technologies for research labs.

Shown below is the preliminary purchase price allocation, which summarizes the fair value of the assets and liabilities assumed, at the date of acquisition:


Current assets, including cash acquired of $389			$	3,143
Intangible assets:
Patents	$	639
Total intangible assets			639
Goodwill			38,620
Other assets			1,194
Liabilities:
Accounts payable and accrued liabilities	3,424
Total liabilities			3,424
Net assets acquired			$	40,172

The Company has performed preliminary valuation analyses of the fair market value of acquired assets and liabilities of both Oqton and Volumetric. The final purchase price allocations will be determined when the Company has completed and fully reviewed the detailed valuations and determined the final purchase consideration for items such as but not limited to working capital adjustments. The final allocations could differ materially from the preliminary allocations. The final allocations may include changes in allocations to acquired intangible assets, changes to assets and liabilities including but not limited to deferred tax assets and liabilities and tax liabilities, as well as goodwill. The estimated useful lives of acquired intangible assets are also preliminary.

On May 6, 2021, we purchased Allevi, Inc. to expand regenerative medicine initiatives into medical and pharmaceutical research and development laboratories. Additionally, on June 15, 2021, we closed the acquisition of a German software firm, Additive Works GmbH (“Additive”). Additive expands the simulation capabilities for rapid optimization of industrial-scale 3D printing processes. The purchase price for both acquisitions, individually and combined, and the expected impacts on the Company’s financial position, results of operations and cash flows are not material.

Acquisitions of Noncontrolling Interests

We own 100% of the capital and voting rights of Robtec, a service bureau and distributor of 3D printing and scanning products in Brazil. Approximately 70% of the capital and voting rights of Robtec were acquired on November 25, 2014. On January 7, 2020, we made a payment equal to the redemption price of $10,000 and acquired the remaining 30% of the capital and voting rights.

We own 100% of Easyway, a service bureau and distributor of 3D printing and scanning products in China. Approximately 65% of the capital and voting rights of Easyway were acquired on April 2, 2015, and an additional 5% of the capital and voting rights of Easyway were acquired on July 19, 2017 for $2,300. The remaining 30% of the capital and voting rights of Easyway were acquired on January 21, 2019 for $13,500 to be paid in installments over four years for which $6,300 and $2,500 were paid in 2021 and 2020, respectively.