IPO Watch: 3D Metal Forge eyes ASX boards with global scale-up plans
The ASX additive manufacturing sector will get a new entrant when 3D Metal Forge (ASX:3MF) joins the boards this morning.
The company serves a global client base largely comprised of companies in the oil & gas sector, and along with its Singapore headquarters it also has an office in Houston, USA.
3MF’s IPO will see it raise $10m from investors at 20c per share. Alto Capital acted as lead manager.
Ahead of the listing, Stockhead spoke with CEO Matthew Waterhouse to discuss the rationale for listing and 3MF’s strategic outlook.
Waterhouse said while going public will provide a platform to pursue the company’s global client strategy, the ASX has also established itself as a regional hub for additive manufacturing businesses.
“Our plan is to open up key markets around the world, with an early focus on Houston, Singapore and the Middle East and I think being a listed company helps with that,” he said.
“And I also think the ASX has demonstrated that it’s open to this technology. There’s a few other listed companies in this space and it’s a positive environment where technologies like ours can list,” Waterhouse said.
Additive manufacturing is the process of using 3D printing technology to enhance production efficiencies.
3MF’s additive technologies include Selective Laser Melting (SLM) for high resolution metal parts, such as the pipes and manifolds used in oil drilling rigs.
Waterhouse said that when deployed correctly, additive manufacturing meets the industry’s current demand for more sustainable manufacturing practices, as well as increased flexibility in the supply chain.
“The key thing for us now is we’re revenue generating, we’ve been doing this for a few years now and we’ve built good relationship with our customers,” he said.
He added that 3MF’s technology is differentiated in the market, in the sense that it doesn’t just produce the parts, it also offers design and training services to clients as part of a recurring-revenue model.
“That recurring revenue is pretty important. We’ve really prioritised building relationships with clients so most of our top 10 clients are repeat clients,” Waterhouse said.
“Our model is to build printed parts as well as a service aspect for our clients and take a partnership approach to meet their needs.”
Along with faster production times, Waterhouse said 3MF has also made some key breakthroughs in production sizes.
“A few years ago, additive was all about a piece here or a piece there. But what we’ve cracked is to be able make it effective for clients to carry out full production runs into the hundreds or thousands of pieces,” he said.
“So clients can choose the right part and choose the right material, and our technology is viable at those numbers. That’s a new thing in the market for additive.”
While the bulk of production work is carried out from 3MF’s Singapore-based manufacturing hub, Waterhouse said a key focus post-listing will be to build out a global presence to reduce transport costs.
“What we want to get to is having four manufacturing hubs around the world in Singapore, Houston, Rotterdam (Holland) and the Middle East,” he said.
“Those jurisdictions are where the concentrations of our kind of industries are — oil & gas industrials manufacturing.”
“What will be ideal is to produce the parts near where they’re needed, rather than shipping parts globally,” he added.
With its ASX listing, Waterhouse said 3MF will also be well positioned to build partnerships in the Australian resources sector, which it can access easily from its Singapore manufacturing base.
“We’re talking to a lot of Australian companies at the moment, and we’re finding there’s a key focus on producing things on a more sustainable basis,” he said.
“There’s a lot of conversations in Perth to work in those sectors, as well as partnerships with university research institutions. So for us the opportunity to list in this market is really exciting.”