An analysis of the 1+1 2 Effect in the merger and acquisition of LED industry

As early as in 2013, some experts predict that the LED industry will be mergers and acquisitions tide. LED lighting in this era of competition has already entered the feudal lords vying for the throne, intense, each has the ability and strength to impact the industry brands enterprises have made no secret of his ambition, hope that through the rapid expansion of industry to expand their competitive advantage. M & a tide intensified, LED industry, the phenomenon of "division and integration" more frequent.

It is very common for a long time, long. With the giant Elec-Tech between NVC marriage it is to open a LED industry merger integration precedent, since then, the industry mergers and acquisitions continued fermentation. 2014, the lighting industry, there have been a number of mergers and acquisitions cases. Among them, there are both cross-border gangster waiting to move, but also the lighting giant swallow small fish, slow fish, more lighting industry in different areas of the enterprise Baotuan heating, expanding their respective advantages.

M & a tide, 1+1 > 2?

First of all, we list the first half of 2014, the LED industry is a well-known case of mergers and acquisitions.

Mao Shuo power at the beginning of this year, announcement, intends to invest 20 million 789 thousand and 500 yuan shares even master equipment. Even the main equipment for LED automation equipment manufacturers, customers include Taiwan Acbel, rectangular lighting, SKYWORTH and other domestic first-line LED lighting company.

In February 24th, Beijing electronics to 21 million 270 thousand yuan acquisition of founder 100% stake, officially starting LED lighting field, the founder of the estimated value reached 286 million yuan.

February 28th, crystal photoelectric 14 million 380 thousand yuan acquisition of Jia Jia Electronics shares of 20%.

In March, chip maker Microchip Technology (MCHP) to $394 million in cash to acquire high voltage analog and mixed signal chip maker Supertex, to strengthen its of LED lighting, medical, industrial and telecommunication industry supply.

In May 21st, Jiawei shares announcement, to expand the domestic market, Jiawei shares company and products lighting all shareholders signed the "equity transfer agreement" in May 19th, 123 million married lighting products.

In May 24th, in time for the last day of the three month suspension of doomsday, Chukyo electronic disclosure acquisition program, intends to combine the issuance of shares and cash to acquire 100% equity interest in Hunan founder.

In May 27th, Lehman photoelectric announcement, the company intends to cash invested 35 million 939 thousand yuan acquisition of Shenzhen apexls Electronics Co., 43.3%, and in the above equity after the completion of the delivery within 10 working days, and then invested 16 million 101 thousand yuan to subscribe apexls capital, after accounting for the capital increase the registered capital of 13.59%, of which 3 million 142 thousand and 900 yuan in registered capital, part of the premium 12 million 958 thousand and 100 yuan included in capital reserve. After the completion of the capital increase, the company will hold a total of 51% equity interest in the exhibition, becoming its controlling shareholder.

In June 19th, with the announcement, intends through its wholly-owned subsidiary company of THTF Energy-Saving Holding Limited for the issuance of 1 billion shares of Neo-Neon Holdings Limited (HK $0.1), and to make a general offer to shareholders zhenminglee. The subscription price of HK $900 million in total, the company will hold 51.6% zhenminglee through THTF ES stake, becoming its controlling shareholder.

Dubbed "LED lighting industry will be 2014 years" of the title, the rapid development of the industry, LED leading enterprises are actively expanding, whether vertical integration between the middle and lower reaches of the market, or horizontal integration between enterprises in the field of rapid expansion, or is arranged in a crisscross pattern strong breakout, the ultimate goal of enterprise merger integration is initiated. Companies hope that through mergers and acquisitions for the enterprise to bring the scale, channel, brand, production, technology, personnel and other aspects of the advantages, to the effect of 1+1 > 2.

LED companies can achieve the desired results through mergers and acquisitions? Due to belong to different entrepreneurs, the first two companies in the management, culture, values and other aspects are different. Therefore, the industry believes that although the acquisition of transactions can be immediate, however, to produce the expected benefits are also in the late run.

Filtering ideas, risk assessment

At present, the competition of LED industry is fierce, the market is chaotic and disorderly, a large number of homogenization, low-end products snatch limited channel resources, not only caused a waste of resources, but also weakened the competitiveness of the industry as a whole. Mergers and acquisitions as an effective way to integrate resources, mergers and acquisitions by enterprises to seize the upcoming outbreak of the lighting market, has become the industry consensus.

From the LED industry in recent years, many mergers and acquisitions, mainly has the following characteristics: cross-border or upstream businesses by mergers and acquisitions in the lighting field, extend the industrial chain to realize the diversification strategy; small and medium enterprises by horizontal mergers, complementary advantages, the integration of their own strength, improve the core competitiveness; patent rights restrictions through merger, avoid part of the acquisition method, get the initiative in the market. Industry consolidation will undoubtedly become the industry trend, the stronger the stronger, the weaker the weaker situation will be fully demonstrated. No matter what kind of integration, are in order to better fight the era of LED lighting.

For a time, lighting enterprise quality has become the capital market "xiangbobo" has sustained profitability and has reached the billion scale enterprises has become a target for all "". And in the domestic LED industry, to meet the conditions of the enterprise less and less, which led to the LED industry mergers and acquisitions market demand situation. In the atmosphere of LED lighting mergers and acquisitions, the normal industry mergers and acquisitions into financial models and mergers and acquisitions game. The appearance of this kind of situation also affected the normal trading order to some extent