DPE's SLM Solutions plans IPO

It is understood that the IPO will be launched before the end of May, and that DPE is not looking to divest its entire stake in the company after backing it last year.

SLM intends to generate proceeds of approximately €75m before costs in order to finance its growth strategy. According to SLM's CFO, the company is focusing on three initiatives that will enable it to facilitate growth: the build-up of its sales force and service network in order to satisfy demand for its products internationally; investment in the metal powders it uses in its laser melting systems; and a continued focus on research and development. SLM is actively looking for acquisition opportunities in order to be able to offer the entire range of 3D printing systems.

According to SLM's CEO, the IPO should prove timely as the 3D printing market moves from providing prototypes to starting serial production of parts. Industries which are supported by 3D printing notably include aerospace, automotive, energy (for which SLM can provide turbine blades), and healthcare, where 3D-printed hip implants are in production.

SLM's customer base includes Nasa, General Electric, Siemens, Alstom and BMW. In 2013, 67% of its revenues came from outside Germany, contributing to its €21.6m turnover for the financial year. Its adjusted EBITDA margin was 11.5%, or close to €2.5m.

Consultancy Wohlers Associates estimate that the 3D printing market has substantial growth potential, increasing from $2.2bn in 2012 to $6bn by 2017, reaching $10.8bn in 2021. Metal-based additive manufacturing accounted for 9%, or €161m, of the overall 3D printing market in 2012.

In April last year, DPE completed a growth capital transaction in the company from its DPE Deutschland II Fund, taking a 57% stake. That month also saw the fund complete its final close on its €350m hard-cap, exceeding its target by €50m.

Credit Suisse and Deutsche Bank are joint global coordinators and joint bookrunners for the IPO. BHF-Bank and Canaccord Equity are co-lead managers, while Equinet Bank will act as selling agent.

Headquartered in Lübeck, SLM is a 3D printer maker that uses a laser beam applied to a bed of fine metallic powder. This fuses the powder together and creates a three-dimensional object. The company has 80 employees and can trace its roots back to 1863. It separated from its parent company MCP in 2010, before being renamed SLM Solutions in 2011.

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