Eliminate the weak and stay strong, the LED integration tide will continue in 2014

[Text/Zhao Hui] Under the support of the 18th National Congress to encourage capital market development, support for mergers and acquisitions and the relevant support of the State Council, the 2014 emerging industry M&A transactions will continue to be popular in 2013.

Since the 18th National Congress, economic transformation and upgrading has become a top priority, and emerging industries are undoubtedly the vanguard of transformation and upgrading. In particular, small and medium-sized enterprises and GEM companies that have already listed have opened up the M&A boom based on the capital market, forming an unprecedented peak in mergers and acquisitions.

Last year, with the rapid increase in LED lighting demand, the LED industry has also ushered in an unprecedented peak of development. Enterprises in all links of the upstream, middle and lower reaches have begun to expand production, and the cloth channel has seized more market share. As one of the most convenient and efficient, M&A has been favored by LED listed companies.

Since the second half of last year, almost all LED listed companies have had large and small mergers or acquisitions or various forms of strategic cooperation.

Under the background of the weak and strong LED industry, listed companies with product, technology and capital advantages are accelerating their development and integration, with a view to the rapid development of the LED lighting industry and the first-mover advantage when the concentration is improved.

After last year's acquisition of NVC by Sanhao Runda and Sanan Optoelectronics' acquisition of Taiwan's Yuyuan Optoelectronics, this year, Tongfang shares have invested 900 million Hong Kong dollars in Zhen Mingli, and Wei Wei shares to welcome more than 12 million LEDs on the lighting. The mergers and acquisitions of the industry took place, and the entire industry chain battle became more and more fierce, and the industry integration drama gradually culminated.

The government's policy support for mergers and acquisitions is also constantly improving. Today, the China Securities Regulatory Commission issued a refinancing method for listed companies on the GEM.

For the refinancing of the GEM, which is most concerned about the industry's combined capital market, the measures stipulate that the issuance conditions for the refinancing of the GEM include the profit for the last two years; the cash dividends for the last two years; the asset-liability ratio at the end of the latest period is higher than 45%. A total of 6 conditions.

"Most of the companies listed on the GEM are emerging industries like LEDs. They are in a high-speed growth period. If they can't refinance for a long time, it is not conducive to the long-term development of the company." The LED company listed in the company believes that the LED industry is now During the integration period, M&A needs the support of funds, and the introduction of refinancing methods can be described as timely rain.

"The cost performance of LED lighting products has a strong advantage. The outbreak of the lighting market is certain. This year is mainly to test whether the performance of LED companies can meet market expectations." Zhou Yi, a researcher at Huatai Securities, believes that LED companies rarely have Enterprises with an output value of more than 1 billion yuan, how to quickly become bigger and stronger, need more mergers and acquisitions, restructuring, and shareholding in the LED industry.

Recently, the lighting of the old-fashioned lighting products has been captured by the company, which has attracted the attention of the entire LED industry.

According to the announcement, Weiwei Co., Ltd. and all the shareholders of Zhongshan Pinshang Lighting Co., Ltd. signed an equity transfer agreement, stipulating that 100% of the equity of the lighting will be transferred by cash. The parties to the agreement took the estimated value of the product lighting of 122.5 million yuan as the initial transfer consideration.

The original lighting business of Weiwei is mainly concentrated in overseas markets, and the domestic lighting market will be even bigger in the future. As a lighting-oriented company, it will naturally not give up the domestic market.

“Commercial lighting and home lighting are the key product lines of Weiwei in overseas markets; entering the domestic market, these two aspects are still one of our main business areas. Looking for a suitable commercial brand, there is a relatively high domestic market. Brand management, has a good reputation, has a ready-made dealer base, these factors and conditions are the premise of the M&A companies we are looking for. The qualifications of the products are in line with the current needs of the company's development; The prospects and concepts for future development are also highly consistent." Li Wei, president of Weiwei, said in an interview with the media.

As a veteran lighting company, the lighting has a good resource in terms of channels and brands. However, due to various reasons, the development of the company has stagnated. Although the lighting on the product has increased the transformation of LED, it is still difficult to return to glory. At this point, seeking external forces is the best option. Yan Wei and the marriage on the product were also optimistic about the industry.

Up to now, LED listed companies still have long-term lighting, Ganzhao Optoelectronics, Hongli Optoelectronics, Huacan Optoelectronics, and Weiwei shares in the stock suspension due to major asset restructuring.

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