3-D Printing Company Fathom Reaches $1.4 Billion SPAC Deal to Go Community

Fathom Digital Producing Corp. is combining with a distinctive-function acquisition business to go community in…

Fathom Digital Producing Corp. is combining with a distinctive-function acquisition business to go community in a offer that values the 3-D printing firm at about $1.4 billion, the firms explained.

Based mostly in Hartland, Wis., Fathom employs digital producing methods to quickly make prototypes and complex manufacturing parts for its shoppers. Fathom claims it allows blue-chip businesses innovate and solve operational challenges.

The business is merging with the SPAC Altimar Acquisition Corp. II. The Wall Road Journal formerly claimed the two sides were being nearing a offer.

Fathom is one particular of quite a few making an attempt to tap into a booming sector for 3-D printed goods, with more businesses throughout industries trying to find to simplify supply chains, convey down prices and decrease their environmental footprints.

“We allow our shoppers to accelerate innovation,” Fathom CEO Ryan Martin mentioned. “We grow to be their secret sauce when it comes to product progress.”

Owned by the non-public-fairness agency Main Industrial Companions, Fathom joins many 3-D printing companies likely general public via SPACs.

Desktop Metallic Inc.

went public by using a SPAC backed by the identical investment decision firm—HPS Financial investment Companions LLC—that backs Altimar. Other businesses in the area to not too long ago unveil so-identified as blank-verify specials contain Velo3D Inc., Markforged and Shapeways.

Personal providers are flooding to distinctive-intent acquisition providers, or SPACs, to bypass the classic IPO system and obtain a general public listing. WSJ describes why some critics say investing in these so-termed blank-check out corporations isn’t value the danger. Illustration: Zoë Soriano/WSJ

With buyers psyched about the industry’s progress probable, many of these businesses are drawing lofty valuations and elevating big sums as a result of their SPAC bargains. Fathom is expected to create about $425 million in income proceeds by way of its merger from the $345 million held by the SPAC and a $80 million non-public expenditure in community fairness, or PIPE.

Fathom has quite a few production facilities across the U.S. and hopes to differentiate alone from early-phase providers likely general public through SPACs by touting its current business enterprise. Fathom posted about $150 million in revenue in its 2020 fiscal yr.

Also known as a blank-check out organization, a SPAC is a shell organization that lists on a stock exchange with the sole objective of merging with one more business to just take it community. SPAC bargains have emerged as a well known alternate to a common first general public offering in the previous 18 months, partly due to the fact they allow for corporations these kinds of as 3-D printing corporations to make business projections, which an IPO wouldn’t permit.

SPAC executives say the offers are accelerating growth for disruptive providers, though skeptics contend that they disproportionately reward insiders who are granted exclusive incentives.

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Altimar raised $345 million in February and is a single of quite a few SPACs backed by HPS. One of them took Desktop Metal public late previous year, when yet another put together with Owl Rock Cash Associates LP and Dyal Money Partners to produce

Blue Owl Funds Inc.

SPACs have raised a record of about $115 billion this yr, in accordance to info provider SPAC Study. Issuance, nonetheless, has slowed in latest months, as shares of some well known organizations that merged with SPACs battle and regulators raise their scrutiny of the sector.

Shares of Desktop Metal and the blank-check providers getting other 3-D printing providers public have struggled in modern months as have other publicly traded names in the place such as 3D Systems and

ExOne Co.

Continue to, some investors remain self-confident a number of companies will develop rapidly in the years forward as far more prospects use smart engineering in their industrial processes.

“This has to come about for so quite a few distinct macro causes,” Altimar CEO Tom Wasserman explained. “There are heading to be a range of winners in the area.”

Generate to Amrith Ramkumar at amrith.ramkumar@wsj.com

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Appeared in the July 17, 2021, print edition as ‘3-D Printing Company Fathom Cements SPAC Listing.’