What Happened?
Shares of 3D printing company Desktop Metal (NYSE: DM) jumped 115% in the pre-market session after a court ruled in its favor in its litigation against Nano Dimension relating to the pending merger between both companies.
Desktop Metal had previously filed a lawsuit, accusing Nano Dimension of intentionally delaying efforts to secure the necessary regulatory approvals to complete the deal. Desktop Metal also filed a lawsuit alleging that Nano Dimension violated the terms of its merger by subsequently entering into a separate merger agreement with Markforged. The complaint asserted that finalizing the Nano-Markforged merger before completing the pending merger between Desktop Metal and Nano Dimension could undermine or prevent the successful completion of that original deal.
The Desktop Metal/Nano Dimension merger was initially announced on July 3, 2024, when Desktop Metal agreed to be acquired by Nano Dimension in an all-cash transaction valued at $5.50 per share. This offer represented a 27.3% premium over Desktop Metal's closing stock price before the news of the acquisition became public.
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What The Market Is Telling Us
Desktop Metal’s shares are extremely volatile and have had 64 moves greater than 5% over the last year. But moves this big are rare even for Desktop Metal and indicate this news significantly impacted the market’s perception of the business.
Desktop Metal is up 61.4% since the beginning of the year, but at $4.35 per share, it is still trading 61.2% below its 52-week high of $11.20 from April 2024. Investors who bought $1,000 worth of Desktop Metal’s shares 5 years ago would now be looking at an investment worth $44.29.
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