3D Systems Moves Latest Acquisition Out of Austin Media & Technology by Carlos Martinez 3D Systems Corp. will close the former DTM Corp. facility in Austin, Texas that it acquired last year, and move all its operations to its home base in Valencia. CEO Brian K. Service said the closure is part of an overall reorganization of the company due to declining sales in a down economy. “We believe we have a solid business and good opportunity for long-term growth,” he said. It was unclear how many jobs would be lost as a result of the move. 3D Systems creates three-dimensional models from one-dimensional drawings or photographs as part of the development process of new products. The company acquired fellow model-maker DTM last August for an estimated $45 million after it settled a lawsuit with the U.S. Justice Department. The department had attempted to block the sale on the grounds that it would reduce competition in a sector with very few players. The only other U.S. company that competes with 3D Systems is Stratasys Inc. of Minnesota. As part of the lawsuit settlement, 3D Systems agreed to license its Rapid Prototyping technology to others who might want to compete in the market. The technology allows users to develop and create three-dimensional plastic models using lasers, scanners and computers. About 200 people work at the Austin plant, which had been home to DTM since its inception in 1997. For the quarter ending June 28, 3D Systems reported a net loss of $6 million on revenue of $28.8 million, compared to a net loss of $344,000 on revenue of $25 million during the same period last year. 3D Systems’ top customers include Apple Computer Inc., The Boeing Co. and DaimlerChrysler AG. Xircom Barred From Shipping Products A federal judge has barred Thousand Oaks-based Xircom Inc., a subsidiary of Intel Corp., from shipping its new local area networking and modem cards until a lawsuit over alleged patent infringement is resolved. Xircom officials would not comment. Santa Clara, Calif.-based 3Com Corp. filed a lawsuit last year claiming Xircom infringed on its patents when it developed a number of its new products, including RealPort and RealPort 2. The injunction, which took force on July 25, was approved after 3Com filed its motion to halt the shipping of 26 products Xircom had planned to begin distributing this summer, said Mark Michael, vice president and general counsel for 3Com. Qualstar Acquires N2Power Tape storage device maker Qualstar Corp. of Simi Valley has acquired Newbury Park-based N2Power Inc. for an undisclosed price. The privately held N2Power was founded in 1998 and designs and manufactures small power supplies for data storage units and other electronic devices. William Gervais, Qualstar president and CEO, said the acquisition will allow the company to further improve its technology and its share of the market. “Acquiring N2Power allows us to leverage the advantages inherent in their unique technology in our tape library designs,” Gervais said. The acquisition comes a week after publicly held Qualstar announced it has established a research and development center in Boulder, Colo. The new facility will allow the company to tap into that area’s growing number of high-tech engineers, said company spokesman Steve Friedberg. Qualstar, which employs about 100 people, will continue to operate a separate research and development unit at its Simi Valley headquarters, Friedberg added. For the quarter ending March 31, Qualstar reported net income of $695,000 on $8.6 million in revenue, compared to $1.3 million in net income on $11.1 million in total revenue for the same period last year. MEMGen Closes $5.7 Million in Funding Micro-device maker MEMGen Corp. of Burbank closed $5.7 million in financing last week. The round of financing was led by Partech International, a venture capital firm based in San Francisco. Others involved in the funding were Dynafund Ventures, Draper Fisher Jurveson, Chevron Technology Ventures LLC, Zone Ventures, Atherton Venture Partners LLC, Venture Law Group, Riordan & McKinzie and McDonnell 1998 Co-investing. Dave Welsh, general partner in Partech International, said the company’s cutting-edge technology was among the reasons for investing in the tiny startup. The company is named after its micro-devices, or MicroElectroMechanical Systems. “The company’s breakthrough micro-manufacturing technology, combined with its strong, experienced management, will enable MEMGen to catalyze micro-device developments in a variety of industries,” he said. MEMGen raised more than $11 million in first-round financing, with Pentech Financial Services providing $1.5 million for equipment leasing. Adam Cohen, MEMGen president and CEO, said the new financing will help move the company’s advanced technology forward. “We weren’t planning to raise additional funding at this time. Partech approached us and impressed us with its track record of turning vision into success in other emerging industries,” Cohen said. The company’s so-called E-Fab technology allows it to manufacture sophisticated miniaturized devices, or microelectromechanical systems. Cohen said the company’s goal is to develop and mass-produce three-dimensional micromachines and micro-parts. Business Journal reporter Carlos Martinez may be reached at (818) 676-1750 ext. 17 or by e-mail at [email protected].
