Desktop Metal, a Burlington-based 3-D printing company that was once regarded as a pioneer in its field, has declared bankruptcy and is planning to auction off its assets shortly. This decision came after Nano Dimension, an Israeli 3-D printing company that acquired Desktop Metal for $183 million in April, decided to stop funding its subsidiary. Nano Dimension’s CEO, Ofir Baharav, stated that they are focusing on maintaining their financial strength.
Desktop Metal is in a precarious financial position, with debts exceeding $138 million. Recently, the company missed an interest payment on its convertible notes issued in 2022. Additionally, it owes $29 million to lawyers associated with the completion of the deal with Nano Dimension.
In a critical move, Desktop Metal has agreed to sell its subsidiaries in Germany, Italy, and Japan to Anzu Partners for $10 million. This funding is essential for paying bankruptcy lawyers and facilitating the upcoming auction. If the court does not approve this transaction, the company will begin liquidation.
Desktop Metal has faced numerous challenges since its founding in 2015, aiming to revolutionize manufacturing through 3-D printing technology derived from MIT developments. Despite its promising start, the company’s fortunes turned downward after going public via a merger with a blank check company in December 2020. This move initially helped expand its 3-D printing capabilities, allowing acquisitions of smaller competitors. However, continuous financial losses and escalating interest rates caused a severe drop in stock prices, plummeting over 90% in the past year.
Attempts to merge with larger peer Stratasys were also unsuccessful. Even after an eventual acquisition by Nano Dimension last July, internal struggles among stakeholders led to a halt in financial support, resulting in Desktop Metal’s current state.
Ric Fulop, founder and former CEO of Desktop Metal, initially garnered considerable investment, drawing hopes from stakeholders that 3-D printing would transform the marketplace. Ultimately, however, the company has reported no profits, with an expert noting it is essentially a research and development entity that has struggled to achieve positive cash flow.