3D Systems (NYSE: DDD) is acquiring Oqton, a software company specialized in the creation of a new breed of intelligent, cloud-based Manufacturing Operating System (MOS) platform. The acquisition valued $180 million, targets improvements in AM production and digital additive mass production. Interestingly, just two weeks ago, Oqton had further formalized its ongoing collaboration with 3D Systems’ direct competitor EOS. The company—which has been funded metal AM powder supplier by Sandvik—is also working with several other hardware manufacturers including Prodways, Sisma, Trumpf, HP and Stratasys.
This Oqton platform is 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 (IIOT), artificial intelligence (AI), and machine learning technologies to deliver a new and powerful way for customers to automate their digital manufacturing workflows, scale their operations and enhance their competitive position. The use of these tools along with an agile platform will allow for rapid adoption of even the most challenging production workflows such as those for dentistry, healthcare, biotech, aerospace, and automotive.
“Customers across our industrial and healthcare segments are accelerating the adoption of additive manufacturing into production environments,” said Dr. Jeffrey Graves, president and CEO, 3D Systems. “They have increasingly identified the need for a manufacturing software platform that can easily and intelligently incorporate not only the printers themselves but all digital production systems and key enterprise software to optimize the entire workflow, from raw material to finished and inspected components. The system must be flexible enough to accommodate not only today’s manufacturing technologies but also be easily adaptable to future platform changes.”
Availability of the Oqton MOS addresses a critical industry need by optimizing customers’ use of 3D printing and other advanced manufacturing technologies, including robotic welding, machining, finishing, and inspection operations, in full production environments. To fill this need most effectively, Oqton will operate as an independent organization and solution platform within 3D Systems with data confidentiality and security protocols assured through third-party verification.
“The Oqton MOS fills this market need by seamlessly leveraging enterprise information and data in the customer’s current ERP, MES, PLM, and CRM systems, as well as the full range of shop-floor manufacturing operations and software—Mr. Graves continued. “The use of APIs to create ease of linkage between these systems is a distinctive attribute of the Oqton MOS. This allows customers to use their choice of manufacturing and automation equipment on the shop floor to meet their unique factory needs. Oqton’s cloud-based MOS solution, with its embedded AI and machine learning capabilities, then optimizes and automates these manufacturing elements in a manner that is not available today. This solution lowers the barrier to adopt AM in a transformative way – through the integration of the solution AND the optimization of the production workflow.”
With the acquisition of Oqton and the commitment to continue its focus on transforming and optimizing digital manufacturing systems, 3D Systems will also expand availability to the entire additive manufacturing industry and customer base its most advanced software platforms – 3DXpert, 3D Sprint, its Geomagic portfolio, and Additive Works’ Amphyon – as optional add-ons to the Oqton MOS platform. With 3D Systems’ continued investment in these market-leading additive manufacturing tools, the company is confident they can be instrumental in advancing the use of AM across all markets, to the benefit of all stakeholders in this rapidly evolving industry.
Commenting on this transaction, Dr. Ben Schrauwen, CEO and co-founder of Oqton, said: “We are excited about joining with 3D Systems and look forward to leveraging their knowledge, resources, and ability to continue to innovate and deliver solutions that help companies accelerate the adoption of additive manufacturing in production environments. At the same time, we bring our deep expertise in artificial intelligence, automation, robotics, and machine learning, which will help our customers and partners to scale and connect different manufacturing processes in a wide range of healthcare, bio-tech and industrial markets verticals.”
Based on available data, it is estimated that spending in smart manufacturing is $1.5 billion today with an expected expansion to $6 billion by 2025. The purchase consideration for this transaction totaled $180 million, comprising cash and 3D Systems’ stock. With the addition of Oqton, 3D Systems expects the run rate revenue from software to exceed $100 million by the end of 2025. The transaction is expected to close in the fourth quarter of 2021 following required regulatory approvals.