Since September 2012, six large-scale mergers and acquisitions have taken place in the industry, amounting to 4.095 billion yuan, involving the two sides of the Taiwan Strait, and most of them have jointly completed the integration of production capacity, channels, patents, talents, and market resources.
LED industry "integrated hot" market competition will return to orderly <br> <br> integrate the tide coming in September 2012 Taiwan Lunda Electronics and Wellypower merged into the new Ronda, December BDO Runda marriage NVC; In April 2013, Yuanrong Opto-electronics acquired Ruineng Technology. In June, it was the peak period. Taiwan Everlight was planning to acquire 390 million NT dollars to acquire German lighting factory. In mainland China, Sanan Photoelectric Circle acquired Luminus from the United States and is currently participating in Taiwan’s round-the-clock roundup. , And set up a joint venture with Hao Wei shares lighting company. In addition, there are plans to invest 47 million yuan in the United States to establish a wholly-owned subsidiary, the goal is to buy foreign high-quality assets, technology or companies.
As early as 2006 to 2007, the LED industry in Taiwan formed a complete industrial chain and a few giants' industrial structure through merger and restructuring. In recent years, under the active support of the country, the rapid development of the mainland LED market, the intensified competition in the industry, and the differentiation between companies began to emerge. In the face of the market, especially the expansion of the lighting market, it has become the consensus of many companies to strengthen their overall strength through mergers and acquisitions, resource integration, strong alliances, and complementary strengths so as to occupy a competitive advantage when the market really breaks out.
In 2013, the industry has entered the critical period of integration. The cooperation model between enterprises requires vertical and horizontal cooperation of the industry chain. In 2012, there was an excess of structural capacity in the upstream production capacity and competition was intensifying. M&A reduced duplicate investment to a certain extent, mitigated vicious price competition, and improved the overall ability of both parties to resist risks. On the other hand, many companies have chosen to complete the integration of production capacity, channels, patents, talents, and market resources through mergers and acquisitions.
"Matthew Effect" <br> <br> accelerate cross-strait LED manufacturers recently abuzz exit the message, in addition to Taiwan Kellett, Chinese companies pumping more money due to banks, including the male mind lighting, Shenzhen ten face closure. Ye Guang, chairman of Ye Guang, said bluntly that the LED lighting factory, like the previous energy-saving light bulb factory, appeared to be in a wave of manufacturers. Now it is only the first wave, and when it is still uncertain, it should allow the industry to develop healthier.
Jianfeng Ren, chairman of the LED chip factory, also said that there will be similar conditions in other manufacturers, but this is healthy for the industry. Jian Fengren said that the main terminal applications of China's LED plants are mainly lighting, but LED lighting has no clear standard, so price competition is fierce.
Ye Xifu pointed out that before the launch of energy-saving light bulbs, there were also three wave of manufacturers, which took about 10 to 20 years before the energy-saving light bulb industry gradually became healthy and smoothly replaced incandescent light bulbs. Now LED lighting is also moving. This trend, and now this wave of bankruptcy, has occurred in companies with low technology and low capitalization.
In addition to Kellett, Taiwanese companies including Cheng Jia retired because of financial problems, and Mings was affiliated with Ai Di Sen. Tai Yi also revoked counters. These lighting-based companies have strong lighting requirements, but The pressure to drop prices has evaded the market, showing that the industry trend of Evergrande is a foregone conclusion.
It is expected that as the industry enters a high-speed growth period, the combination of brands and channels, and the trend of deep integration of the industry chain will intensify in recent years, and the Matthew effect will soon emerge.
The advantages of integration
For the expansion of market competition in the region and enhance the core competitiveness, such as BDO Runda acquisition of NVC Lighting, Sanan Optoelectronics acquisition of the United States shares Luminus, Taiwan and other round. Through vertically integrated mergers and acquisitions, companies have opened up the entire industry chain of the upper, middle, and lower reaches to achieve an integrated layout. Second, through cross-border mergers and acquisitions, the important driving force for enterprises to cross-border mergers and acquisitions is the patent and the international market. LED patents have long been in the hands of several major international giants, especially in the chip segment. By acquiring foreign companies, they can bypass patent barriers and obtain international manufacturers. Patent support.
Integration is strength, and mergers and acquisitions are undoubtedly an effective resource integration method. Today, economic globalization has become an important way for companies to rapidly realize capital accumulation, resource possession, and market expansion. Behind these various kinds of integration is industry resources. Concentrate further on the dominant companies, and then show the survival of the survival of the fittest. Only through the ebb and wash of waves, the entire industry can be developed in a more healthy and orderly manner. Integration is an inevitable process for the industry. Take the words of industry professionals: “The journey of LED lighting is an oasis.â€
Industry group inflection point almost <br> <br> upstream chip market: in 2012, the overall size of China's semiconductor lighting industry reached 192 billion yuan, an increase of 23% compared with 156 billion yuan in 2011, growth has slowed down and become nearly For several years, the domestic semiconductor lighting industry has experienced the lowest development speed. The scale of upstream epitaxial chips, midstream packaging, and downstream applications were respectively 8 billion yuan, 32 billion yuan, and 152 billion yuan. Among them, domestic enterprise chip revenue increased by 23% in 2012 to 8 billion yuan; in 2011, the utilization rate of domestic GaN chip production capacity was about 50%, the annual output was only 115 billion, and the output growth rate was 63%, which was far greater than the output value. Growth rate. Overall, the chip's localization rate reached 72%, and significant progress was made in lighting applications. In particular, the competitiveness of domestically produced chips for medium and low-power lighting applications gradually emerged. Although the market share of lighting chips is still low, about About 25%, but compared to 17% in 2011, there is a big increase.
Middle package: In 2012, China's LED packaging industry scale reached 32 billion yuan, an increase of 12% compared with 28.5 billion yuan in 2011, and production increased from 182 billion in 2011 to 241 billion, an increase of 32%. From the product structure point of view, SMD-LED packaging growth is most obvious, accounting for about 50% of the total output of LED devices, has become the mainstream LED package products. Focusing on small-size backlighting in 2012, Jufei Optoelectronics and Ruifeng Optoelectronics, which focuses on large-size backlights, are leading the way in 2013 and are expected to continue.
Downstream applications: In 2012, the overall scale of China's semiconductor lighting applications reached 152 billion yuan, and the overall growth rate reached 24%, which was the fastest growing link in the entire industry chain, but was affected by a substantial reduction in product prices. It has also become the lowest in recent years. Among them, the output value of lighting application products increased by 40%, and continued to become the largest application area with a market share of 28%. The output of LED lighting products exceeds 300 million. The demand in the domestic market has risen rapidly. The proportion of product exports has decreased by 56%. The backlight application has increased by 32%, accounting for 19% of the total output value of the application field. The most mature landscape application was in 2012. The growth has slowed down to 19%, which is 22% of the total output value, which is lower than in 2011; the growth rate of LED display has slowed down to 13% of the application output value. With the further decline in prices, downstream application vendors have already experienced the spring plumbing in Chunjiang.
The LED industry has ushered in a decline in the price of watershed LED products and a steady increase in quality. This has led to a gradual recovery in demand, which has benefited collectively the companies in the upper, middle, and lower reaches of the industry. Wang Lianghai, Vice President of Tongfang’s shares, was quite pleased with the Southern Reporter in June that due to the abundant orders, the machines were running at full capacity. At that time, many LED listed company executives also revealed that this phenomenon was not uncommon.
With the release of semi-annual reports of several LED industry chain companies in August, the performance in the second quarter was further confirmed. From the three leading companies that recently reported their results, Sanan Optoelectronics achieved a better growth in its main business; Ruifeng Optoelectronics and Jufei Optoelectronics benefited from backlight and lighting growth, achieving a net profit growth of over 30% in the first half of the year.
However, starting in July, Zhongshan Xiongji Lighting Factory, Zhongshan Shihao Leijing Factory, Shenzhen Everlight Technology, Shenzhen Shifang Optoelectronics and other small and medium-sized LED companies have all suspended production.
For this phenomenon, Peng Chengxue, deputy general manager of Shenzhen Jincheng Electronics, stated that any industry has its own life cycle, and after the market matures, it will enter the oligarchic competition stage and emerge as a watershed.
Increasing industry concentration has become a trend
According to Liu Jun, secretary-general of the Guangdong Provincial Lighting Association, for small and medium-sized LED companies, the government can't get a large order, there is no advantage in quality and price under fierce competition, and there are multiple reasons for improvement in channel construction. Do not withdraw from the grim situation.
Taking government orders as an example, the government will set a general demand, and small businesses will naturally see tears from the government's big orders. In the fierce competition in the industry, some small and medium-sized enterprises win by inferior quality and low cost, and once a certain batch of problems occur, they will be badly affected. "Yoshihiro Nakayama used to sell only three pieces of money before he sold only three pieces. One lamp had a meager profit and then pressed some suppliers' money," said one person in the LED industry.
In terms of channel sales, due to the rapid growth of e-commerce channels, many of the traditional ways of relying on agents and distributors to distribute goods to the next-tier level are no longer as effective as before. E-commerce companies have certain requirements for warehousing, logistics, and Internet operations, and it is difficult for small and medium-sized companies to keep up. In the long run, the acceleration of mergers and acquisitions among enterprises in the middle and lower reaches will help the entire LED industry to mature further and allow the market to return to orderly competition.
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