This week, we discuss the recent M&A mania that’s been happening within AI, the outstanding recent performance by 3D Systems, and how innovations in medical manufacturing are enabling a healthier future far beyond the pandemic. We are also hosting a webinar on June 16th about the opportunities and obstacles for robotics across the supply chain. Reserve your seat here.
THNQ: M&A Mania Within the World of AI
Cloud-based data analytics provider and THNQ index member Cloudera (CLDR) jumped 24% on the announcement that private equity firms Clayton Dubilier & Rice LLC and KKR & Co will take the company private for $4.7 billion. Cloudera, an enterprise data platform company, has been under pressure since its acquisition of HortonWorks in early 2019. After a challenging merger integration and series of management changes, Cloudera was already achieving some stability prior to the pandemic spurring a rapid adoption of cloud services driven by remote work.
Cloudera’s mission is to make data and analytics accessible for all, anywhere. The company was recently investing heavily in cloud infrastructure that could operate across multiple cloud providers. In the shift back to private, it can continue that trajectory. This is a similar scenario to former THNQ index member Talend SA, which agreed to be taken private by Thoma Bravo earlier this year.
The era of a multi-cloud environment is here and enterprise data cloud companies like Cloudera are playing musical chairs to find the right partner or otherwise risk being left behind. By operating in the private space, these companies have the freedom to increase their investment in innovation and to build the advanced data analytic capabilities required for the next generation of cloud architecture. We believe that this wave of M&A activity creates a tremendous opportunity for investors looking to capture the growth of AI technologies to come.
HTEC: Innovation in Medical Manufacturing
Creating the blueprint for mRNA medicines is just one part of a multi-stage, complex journey from the lab to the patient. Manufacturing and producing these novel therapeutics, such as the large-scale, multi-billion doses of the Covid-19 mRNA vaccine, requires cutting-edge technology, extensive research, and nearly flawless execution. We see this as a new era of precision medicine.
Today, we take a multidisciplinary approach to vaccine manufacturing that combines biology, artificial intelligence, robotics, and lab process automation. This is enabling a faster and more sustainable method of delivering the billions of doses needed. Catalant and Lonza are two HTEC index members that have been working directly with Moderna, Johnson & Johnson, and AstraZeneca to support the production of the vaccine rollout since last June. These innovative companies are transforming the way drugs are being manufactured and play a critical role in the development of groundbreaking therapeutics.
ROBO: 3D Systems Soars
3D Systems, a leading provider of additive manufacturing solutions and a member of both the ROBO and HTEC indices, has seen its share price rise more than 60% in the past month and nearly triple so far this year. After hitting a decade low point in September 2020, the shares have been on a strong recovery trajectory, fueled by significant restructuring under a new management team and a recovery in demand in its key markets: industrial and healthcare applications.
In particular, the company is making significant headway in healthcare, building on its strong position in the dental market. Its 3D printing solutions are used by dental labs and clinics to manufacture custom implants, dentures, and orthodontic models at high speed and high accuracy. These have been particularly successful with the large-scale makers of clear aligners, like Invisalign.
Last week, the company announced the sale of its On-Demand Manufacturing business to private equity for $82 million. One year into the job, the new management team continues to deliver on their aggressive repositioning plan, which included the $55 million divestiture of Cimatron and Battery Ventures last year. Meanwhile, the company is investing in bioprinting and regenerative medicine, having made progress with its Print to Perfusion program and solid-organ scaffolds following the acquisition of bioprinting firm Allevi. 3D Systems expects the Additive Manufacturing market to grow at a 24% CAGR to $35 billion in 2024.