Dear Valued Hypertherm Partner,
I want you to be among the first to know that OMAX Corporation, one of the world’s leading waterjet manufacturers, is planning to join forces with Hypertherm in a merger agreement that establishes OMAX as a wholly-owned subsidiary of Hypertherm.
Today’s announcement signals the combination of OMAX’s industry leading direct drive pumps, software, and applications technologies with Hypertherm’s current waterjet portfolio of intensifier-based pumps, abrasive recycling systems, and AccuStream consumables to form the leading waterjet technology line-up in the industry. While we are confident this transaction will enhance our customer and partner value in industrial cutting solutions, which is our continuing long-term mission, I know there may be some concern among our partners regarding our continued commitment to plasma cutting.
I want to assure you that plasma cutting will always remain the foundation of Hypertherm’s business. We will continue to invest for growth in all parts of our business—including plasma, waterjet, laser, and software—to ensure we continue to innovate for our industrial cutting customers and support our partners. In fact, our current plasma R&D spend is at an all-time high.
Some of you may also have questions about what this means as far as Hypertherm’s go-to-market strategy for plasma cutting products, in which we work with equipment builders (OEMs) and partners like you, given that OMAX sells fully-integrated systems. On this, I want to be completely clear: our current go-to-market strategy for plasma cutting products will not change, and this acquisition does not open the door for Hypertherm to offer integrated plasma cutting tables or other systems. Our 350+ plasma cutting partners reach specific markets and segments and provide specialized system types and service offerings that we could never replicate on our own. This model has allowed Hypertherm to attain and maintain a very strong industry leadership position in plasma cutting technology, and we remain fully committed to it.
The waterjet market is different. Though we remain committed to working with our network of waterjet partners, sales in the waterjet space are much more heavily concentrated. More than 50% of the waterjet market is concentrated with SHAPE and OMAX due to the nature of the industry and technology integration requirements. In addition, because there are far fewer independent OEMs, developing a global network that can compete with SHAPE and OMAX would be a very steep and long up-hill climb. For that reason, we believe today’s announcement is the right path forward for our waterjet leadership strategy.
I know you likely have a lot more questions about this announcement. This Q&A sheet attempts to answer some of those questions. In addition, I invite you to reach out to me, your Hypertherm Account Manager, or other Hypertherm leadership contact if you’d like to discuss this further. In closing though, I want to thank you for your continued support of Hypertherm. We wouldn’t be the company we are today without you.
Sincerely,
Evan Smith
President & CEO
Official attachments
Q & A sheet
Press Release