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Summary

  • MTLS, a provider of 3-D printing services and additive manufacturing software, plans to raise $104.0 million in its upcoming IPO.
  • MTLS believes its software platforms are now the market standard for 3-D printing and boasts a current installed base of more than 8,000 licenses for its software.
  • We strongly suggest growth investors consider buying into this IPO, as the company has also posted strong revenues and has a very impressive overall team.

Materialise NV (NASDAQ:MTLS), provider of 3-D printing services and additive manufacturing software, plans to raise $104.0 million in its upcoming IPO.

The Leuven, Belgium-based firm will offer 8.0 million shares at an expected price range of $12-$14 per share. If the IPO reaches the midpoint of that range at $13 per share, MTLS will command a market value of $624 million.

MTLS filed on April 2, 2014.

Lead Underwriters: Credit Suisse Securities (USA) LLC; Piper Jaffray & Co.

Underwriters: BB&T Capital Markets; Janney Montgomery Scott LLC; KBC Securities USA, Inc.; Stephens Inc.

Summary: 3-D Printing Services Across Industries

MTLS provides 3-D printing services and additive manufacturing software to various industries ranging from healthcare to aerospace and art and design.

The firm believes that its software platforms are now the market standard for 3-D printing; MTLS boasts a current installed base of more than 8,000 licenses for its software.

MTLS operates what it believes to be the largest additive manufacturing center in the world in Leuven, Belgium, where it printed over half a million prototypes, medical devices, consumer products, and production parts during 2013. The firm has proactively moved to seize a role in the expanding market for 3-D printed medical devices; MTLS' technology was used in the design and manufacture of over 146,000 patient-specific medical devices in 2013.

The firm has placed special emphasis on research and development, employing a highly educated workforce of 997 that included 410 employees holding masters degrees and 48 holding Ph.D.s as of March 31, 2014. MTLS' intellectual property portfolio contained 62 patents and 101 pending patent applications as of the same date.

Valuation

MTLS offers the following figures in its F-1 balance sheet for the three months ended March 31, 2014:

Revenue: $25,753,000.00

Net Income: $113,000.00

Total Assets: $80,024,000.00

Total Liabilities: $55,455,000.00

Stockholders' Equity: $24,562,000.00

Many Competitors

MTLS competes with numerous other firms that provide 3-D printing services. Major industrial 3-D printing competitors include ARRK, Alphaform, Cresilas, and 3D Systems Corporation (NYSE:DDD). Competitors seeking to impact the home 3-D printing services market include Shapeways and Sculpteo.

Many of MTLS' larger 3-D printing service customers ultimately move their 3-D printing operations in-house. However, as MTLS notes in its S-1 filing, this often creates opportunities for the firm's software segment.

Founder, CEO an Industry Leader

Founder Wilfried Vancraen has served as CEO and a director of MTLS since 1990.

He previously worked as a research engineer and consultant at the Research Institute of the Belgian Metalworking Industry.

Mr. Vancraen holds multiple patents related to technical and medical applications of 3-D printing. Mr. Vancraen has been awarded the RTAM/SME Industry Achievement Award, the highest honor in the 3-D printing industry, and has been selected as the most influential person in additive manufacturing by industry professionals and TCT Magazine.

Mr. Vancraen holds a Master of Science in Electro-Mechanical Engineering and a Masters in Business Administration from KULeuven.

Optimistic Conclusion

We are optimistic on this IPO in the proposed range.

While we are concerned about any exposure to the 3-D printing industry, MTLS is at once a pioneer and a leader in this growing sector. The firm's commitment to research and development should help it to maintain its strong position moving forward.

The firm posted profits in 2012, 2013, and the first quarter of 2014.

The scale and variety of MTLS' manufacturing capacities is a distinct advantage in the 3-D printing sector, as it is able to take on more complex projects that its smaller competitors are not competent to tackle.

Wilfried Vancraen's tenure as CEO has been highly successful thus far, and we expect his technological know-how to continue to benefit the firm.

We are hearing the deal is oversubscribed; buy-side investors have apparently already considered it worthy of a trade.

Note: As a large sample of information sources does not yet exist for MTLS, we have taken much of the information for this article from MTLS' S-1 filing.

We invite readers wishing to join the discussion on IPOs to click the +FOLLOW button above the title of this article.

Source: Rebuild Your Portfolio Around The Materialise NV IPO