Capital dance of construction machinery industry and M & A

With the development of the market, capital operation of enterprises has become one of the main means of development, in which M & A has become the most important way. Large enterprises realize the expansion of scale and the growth of sales through the merger of other enterprises. The data shows that the operation of capital has a positive correlation with the development of the global economy. After the Internet crisis, the amount involved in the global merger and acquisition has declined significantly. However, with the gradual development of the economy, the total amount of the merger and acquisition has gradually picked up, until the subprime crisis, the trend has declined. But it can be predicted that in the process of slow recovery of global economy, the pace of merger and acquisition will be increased again.

Analysis of global industry and M & A

Industry is one of the basic industries in the development of global economy. Although the merger and acquisition of industrial industry is also affected by the financial crisis, the characteristics affected by the economy are not particularly obvious, and reached a peak in 2007, with a total amount of 350 billion US dollars, which is a new high in history. After the subprime crisis, although the amount of industrial merger and acquisition decreased, the proportion of all merger and acquisition increased, nearly 12%, which is the highest level in history.

Obviously, M & A is paid more and more attention by industrial enterprises, and the speed of M & A is accelerating, which shows that scale has become the main direction of enterprise development. In industry analysis, there is a very important dimension of market concentration, that is, in mature industries and markets, the top three of the industry generally occupy 70% - 80% of the market share (the break of this balance requires the emergence of innovation, or new revolutionary technology, or new changes in demand). In 2009, the world's top six construction machinery enterprises accounted for 54% of sales. In the future, the enterprises participating in the competition must gradually strive for the top seats through the advantage of scale, so as to obtain stable income and profits. In order to become the final winner, merger and acquisition has become one of the inevitable choices for the enterprises to win finally.

Domestic construction machinery enterprises and M & a process

The construction machinery industry has only developed for 50 years in China. At present, the market of various products is basically in the development stage, including loaders, excavators and rollers. Although enterprises of certain scale have appeared in these product areas, the whole market is still in an unstable state, and there is a trend of further integration or change. Although driven by the elements of population dividend and the support policies of the state for the industry, domestic enterprises have shown certain advantages in import substitution, but the disappearance of population dividend and the further opening of the market in the future will make the competition more complicated.

Looking at the development process of domestic enterprises, the frequency of merger and acquisition is not high. Many construction machinery enterprises are state-owned. Driven by identity replacement and state-owned retirement, there are many private enterprises, which also give many foreign enterprises the opportunity to enter the Chinese market. In this situation, more changes have taken place in the domestic market.

At present, domestic enterprises are still in the initial stage of merger and acquisition. Here is an example of Sany and Hecha.

Sany hardly involved in M & A. In 2003, Sany Group acquired Shaoyang automobile factory to establish Sany automobile company, entered into the large bus industry, acquired Huayuan Kaima Hunan Automobile manufacturing company, and established Sany Hunan Automobile. The products involved heavy truck, bus and crane. Few news of merger and acquisition came out. "Sany group mainly considers independent development, so we haven't done M & A, which is basically not done," said Xiang Wenbo, President of Sany Heavy Industry.

Anhui Hecha, as a leading enterprise in domestic forklift industry, only carried out three mergers and acquisitions before and after its listing in 1996, and acquired anqing axle factory, Bengbu hydraulic machinery factory and Baoji forklift four factories. Since then, it has basically not carried out capital operation. In 2009, its annual report showed that the monetary capital reached 600 million yuan, and the accounts receivable reached 350 million yuan, accounting for 1 / 3 of its operating revenue. Obviously, its capital utilization efficiency has not been fully developed.

If you look closely at the merger and acquisition years of these two enterprises, it will be found that they have the same listing time. This is because when the listed companies conduct IPO operations, they will carry out pre IPO restructuring to create a company that is competitive, well managed and has growth potential in the market. One of the important considerations is to eliminate peer competition, which is not difficult to understand why these revenues The purchase took place near the location of the company.

The survey results of global listed companies show that the market leaders who only focus on one kind of products have a low survival rate. These enterprises either broaden their product lines to become large enterprises or are merged by large enterprises. If domestic enterprises want to make achievements in the industry, then standardization and collectivization have become inevitable. The diversification of products and the expansion of industrial chain are not dependent on capital means, so it is difficult to have a greater breakthrough.

It should be said that there are not many domestic enterprises that list merger and acquisition as the main means at the level of company development and industry competition. Even Delong, which was called the representative of capital in that year, listed itself as an industrial development company rather than a capital investment company when positioning. The operation mode based on the development of basic industries is the basis of sustainable development of enterprises, but whether it is the best development mode in the current market situation is still worth thinking about.

Liugong group and Zoomlion have become pioneers of their domestic counterparts in this respect.