[Source: Gaogong LED's "LED Lighting Channel" magazine January issue / Xiong Yuheng]
If it is necessary to make an inventory of major events in the LED industry in 2012, NVC Lighting will occupy at least two important seats. The first is the infighting storm caused by Wu Changjiang’s departure in May last year, which made NVC both physically and mentally exhausted. Secondly, at the end of the year, Dehao Runda spent 1.65 billion yuan to acquire a 20.04% stake in NVC and co-starred with NVC. The good show of the giant marriage.
For the marriage of Dehao Runda and NVC, the industry has expressed optimism. NVC has mature brands and perfect marketing channels in the field of traditional lighting, as the domestic lighting industry is worthy. However, in the emerging field of LED lighting, the early NVC continued its evolution of its OEM development model, with limited technology precipitation, especially in the upstream chip field. The lack of core technology has caused NVC's future competitiveness to be worrying. This marriage has just paved the way for NVC to develop the "core".
In the past three years, Dehao Runda has spent 9 billion yuan to complete the complete industrial chain layout from LED epitaxial wafer to chip, from packaging to application (lamps, displays). Therefore, how to turn products and technologies into commercial profits, and then build LED global brands, has become the primary issue that Dehao Runda needs to think about. This time through the acquisition of NVC, using the mature brand of NVC and the perfect marketing channel, Dehao Runda may easily open the key channel to seize the LED lighting market.
Wu Changjiang claimed that the cooperation with Dehao Runda has set a benchmark for industry integration, which will lead the industry to gradually standardize from the previous development. This marriage has also marked the undercurrent of the integration of the LED industry under the reshuffle.
Upstream: horizontal integration and rapid expansion
In 2010, the shortage of upstream chips continued from the beginning of the year to the end of the year, which made chip makers earn a lot of money, and a crazy investment around upstream chips began. However, at the beginning of 2011, the overcapacity alarm for the chip has already started.
Li Bingjie, chairman of Jingyuan Optoelectronics, believes that the mainland's subsidy for the LED industry will end. In 2015, there will be only five mainland chip companies. And high-tech LED CEO Zhang Xiaofei also mentioned that at the end of 2013, all the chip companies with less than 10 MOCVD will disappear. It is understood that there are more than 60 chip companies in the mainland, which means that more than three-quarters of enterprises will be eliminated.
Large enterprises hope to consolidate their leading position through merger and acquisition expansion strength, and small and medium-sized enterprises hope to be preserved by mergers and acquisitions, which is particularly evident in the series of mergers and acquisitions of Taiwanese Ceramics.
On August 9 last year, Jingdian and Guangjia held a briefing session. Guangcai and Jingdian passed the share conversion and became a subsidiary of Jingdian. Guangqi ordinary shares of 4.85 shares were renewed for 1 share of Jingdian, with a transaction amount of NT$4 billion. Jingdian You Yongsheng said that the current production capacity of Guangjia, crystal power can be achieved by investing at least NT$8 billion, so it is a cost-effective transaction for Jingdian. Previously, Jingdian acquired the National League Optoelectronics, Yuan Arsenic Optoelectronics and Lianyong Optoelectronics, which became the chip in the field of crystal power.
Guangji Daizixiang said that after Guangcai was included in Jingdian, it could use the existing technology and sales platform of Jingdian to use the foundry of crystal electricity to reverse the loss of Guangjia. At the same time, Jingdian is no longer affected by the transfer of investment, which can comprehensively improve business performance.
In November of the same year, Sanan Optoelectronics announced that its wholly-owned subsidiary, Xiamen Sanan Optoelectronics Technology Co., Ltd. plans to use its self-raised funds of 506 million yuan (RMB) to subscribe for 120 million private equity shares of Taiwan Yuanyuan Optoelectronics at a price of approximately 19.6 per share. Yuan New Taiwan Dollar. After the implementation of this program, Sanan Optoelectronics will hold a 19.9% ​​stake in Yanyuan Optoelectronics and become the largest shareholder of Haoyuan Optoelectronics.
From the outside world, Sanan Optoelectronics, as the current domestic LED epitaxial wafer and chip leader, has a large production capacity, second only to Taiwan Jingdian, and its products are concentrated in the low-end LED chip market. Yuyuan is the second largest chip manufacturer in Taiwan. The main markets are concentrated in Asian markets such as Taiwan and South Korea. It has a good customer base in the high-end chip market, and the combination of the two can complement each other.
Jianfeng Ren, chairman of Haoyuan Optoelectronics Co., Ltd. said that the production capacity of Haoyuan Optoelectronics is too small and the cost control capability is weak. Sanan Optoelectronics has a large production capacity and low cost. In cooperation with Sanan Optoelectronics, in addition to reducing costs, the company can also use Sanan Optoelectronics to seize the mainland chip market.
For Sanan, with the increasingly saturated mid- and low-end chip market, gross profit margin dropped sharply, and Sanan began to exert its strength in the research and development of high-end LED chip products. At the same time, the market of Sanan Optoelectronics is mainly limited to the domestic market, and it is urgent to break the patent barriers and enter the overseas market. Yanyuan Optoelectronics has more than 200 patents in LED chip technology and is the ideal partner of Sanan Optoelectronics.
According to industry insiders, the main driving force for mergers and acquisitions among upstream chip companies is to expand production capacity and market, acquire new technologies and own each other's patents. Therefore, the companies they choose to acquire are companies with technology, patents or market advantages.
Middle and lower reaches: vertical integration to seize the market
Since 2012, the excess capacity of LED chips and packaging has made the entire industry exhausted. The focus of the industry's attention began to tilt toward the more market-oriented downstream lighting applications, LED lighting has become a new round of investment hotspots.
According to the survey data of the Higher Industrial Research Institute, in the first half of 2012, the overall size of China's LED indoor lighting market showed a substantial increase, with a year-on-year increase of nearly 36%. At the same time, the number of newly added LED indoor lighting companies is nearly 1,000. It is expected that in 2012, the scale of China's LED indoor lighting market is expected to exceed 25 billion yuan, a year-on-year growth rate of more than 40%.
At the beginning of last year, Ruifeng Optoelectronics, a well-known LED packaging company in China, signed a cooperation agreement with NVC Lighting to establish a joint venture company to develop and manufacture LED packaging products for lighting. The company's LED devices are mainly supplied to NVC Lighting.
Ruifeng Optoelectronics chose to cooperate with NVC Lighting, which is the winner of the channel. It is the abundant market channel resources of NVC, which opens up the estuary for Ruifeng Optoelectronics to enter the downstream LED lighting application. However, the project ended with Wu Changjiang’s departure.
Later, NVC chose to marry Dehao Runda, which is more representative. Dehao Runda claims to have a complete industrial chain in the LED field. However, it is understood that Dehao Runda's revenue in the LED field last year was less than 400 million yuan, of which 250 million yuan came from the previously acquired Ruituo display, removing chips and packaging. The revenue of Dehao Runda's LED lighting is less than 50 million.
NVC has mature channels and brand influence, but the OEM-based NVC field is still blank. Before the industry people asserted that the future LED lighting top ten will not appear in the shadow of NVC, so NVC's move seems to be accidental, it is inevitable.
For traditional lighting companies at the crossroads of transition, M&A is an important way to quickly intervene in the LED field.
In May of last year, 100% of the lighting spent 40 million yuan to acquire a British-owned LED lighting company. Prior to this, Sunshine Lighting won a 50% stake in Hangzhou Hanguang Lighting at a price of 13.5 million yuan. It also held a 30% stake in Japan's LIREN Company at a price of 1,233,600 yuan, and obtained the advanced technology of LIREN in the field of LED lighting.
M&A is easy to integrate
At present, the industry is in the post-shuffling era, and the tide of bankruptcy has occurred, including well-known enterprises such as Vision Optoelectronics, Haobo Optoelectronics, and Big Eye Optoelectronics, which have become the industry's "martyr." To develop, the prerequisite is to survive. As long as companies wishing to develop LED lighting are hoping to use M&A integration to compensate for their lack of LED products, brands and channels.
Due to the different entrepreneurs, the two companies in the early stage have obvious differences in management, culture and values. Therefore, the industry believes that although the transactions generated by mergers and acquisitions can be immediate, however, the expected benefits will be in the later run-in. Therefore, the effect of integration on the integration of enterprises cannot be pursued. It can only be gradual.
Just like the marriage between Dehao Runda and NVC, from the outside world, although the two companies are both listed companies, they are strong. However, the two companies had not performed well in the LED field before, and some even ridiculed the combination of the two is a "weak combination."
For NVC, how to rely on the advantages of Dehao Runda's upstream and mid-stream industry chain to quickly reduce costs and provide cost-effective products for its terminal marketing network, however, this is a bit difficult for the low-end Dehao Runda product; For Dehao Runda, I hope to use the mature brand and channel of NVC to break the 9 billion yuan investment and the sales situation is only 400 million yuan. However, NVC, which has just ended the infighting storm, needs time to fully recover its channel advantages.
However, whether it is upstream horizontal integration or vertical integration in the middle and lower reaches, the two sides must first clear their intentions and goals, patents? Talent? market? Then, according to the expected goals, we can work together to make better and farther.
If it is necessary to make an inventory of major events in the LED industry in 2012, NVC Lighting will occupy at least two important seats. The first is the infighting storm caused by Wu Changjiang’s departure in May last year, which made NVC both physically and mentally exhausted. Secondly, at the end of the year, Dehao Runda spent 1.65 billion yuan to acquire a 20.04% stake in NVC and co-starred with NVC. The good show of the giant marriage.
For the marriage of Dehao Runda and NVC, the industry has expressed optimism. NVC has mature brands and perfect marketing channels in the field of traditional lighting, as the domestic lighting industry is worthy. However, in the emerging field of LED lighting, the early NVC continued its evolution of its OEM development model, with limited technology precipitation, especially in the upstream chip field. The lack of core technology has caused NVC's future competitiveness to be worrying. This marriage has just paved the way for NVC to develop the "core".
In the past three years, Dehao Runda has spent 9 billion yuan to complete the complete industrial chain layout from LED epitaxial wafer to chip, from packaging to application (lamps, displays). Therefore, how to turn products and technologies into commercial profits, and then build LED global brands, has become the primary issue that Dehao Runda needs to think about. This time through the acquisition of NVC, using the mature brand of NVC and the perfect marketing channel, Dehao Runda may easily open the key channel to seize the LED lighting market.
Wu Changjiang claimed that the cooperation with Dehao Runda has set a benchmark for industry integration, which will lead the industry to gradually standardize from the previous development. This marriage has also marked the undercurrent of the integration of the LED industry under the reshuffle.
Upstream: horizontal integration and rapid expansion
In 2010, the shortage of upstream chips continued from the beginning of the year to the end of the year, which made chip makers earn a lot of money, and a crazy investment around upstream chips began. However, at the beginning of 2011, the overcapacity alarm for the chip has already started.
Li Bingjie, chairman of Jingyuan Optoelectronics, believes that the mainland's subsidy for the LED industry will end. In 2015, there will be only five mainland chip companies. And high-tech LED CEO Zhang Xiaofei also mentioned that at the end of 2013, all the chip companies with less than 10 MOCVD will disappear. It is understood that there are more than 60 chip companies in the mainland, which means that more than three-quarters of enterprises will be eliminated.
Large enterprises hope to consolidate their leading position through merger and acquisition expansion strength, and small and medium-sized enterprises hope to be preserved by mergers and acquisitions, which is particularly evident in the series of mergers and acquisitions of Taiwanese Ceramics.
On August 9 last year, Jingdian and Guangjia held a briefing session. Guangcai and Jingdian passed the share conversion and became a subsidiary of Jingdian. Guangqi ordinary shares of 4.85 shares were renewed for 1 share of Jingdian, with a transaction amount of NT$4 billion. Jingdian You Yongsheng said that the current production capacity of Guangjia, crystal power can be achieved by investing at least NT$8 billion, so it is a cost-effective transaction for Jingdian. Previously, Jingdian acquired the National League Optoelectronics, Yuan Arsenic Optoelectronics and Lianyong Optoelectronics, which became the chip in the field of crystal power.
Guangji Daizixiang said that after Guangcai was included in Jingdian, it could use the existing technology and sales platform of Jingdian to use the foundry of crystal electricity to reverse the loss of Guangjia. At the same time, Jingdian is no longer affected by the transfer of investment, which can comprehensively improve business performance.
In November of the same year, Sanan Optoelectronics announced that its wholly-owned subsidiary, Xiamen Sanan Optoelectronics Technology Co., Ltd. plans to use its self-raised funds of 506 million yuan (RMB) to subscribe for 120 million private equity shares of Taiwan Yuanyuan Optoelectronics at a price of approximately 19.6 per share. Yuan New Taiwan Dollar. After the implementation of this program, Sanan Optoelectronics will hold a 19.9% ​​stake in Yanyuan Optoelectronics and become the largest shareholder of Haoyuan Optoelectronics.
From the outside world, Sanan Optoelectronics, as the current domestic LED epitaxial wafer and chip leader, has a large production capacity, second only to Taiwan Jingdian, and its products are concentrated in the low-end LED chip market. Yuyuan is the second largest chip manufacturer in Taiwan. The main markets are concentrated in Asian markets such as Taiwan and South Korea. It has a good customer base in the high-end chip market, and the combination of the two can complement each other.
Jianfeng Ren, chairman of Haoyuan Optoelectronics Co., Ltd. said that the production capacity of Haoyuan Optoelectronics is too small and the cost control capability is weak. Sanan Optoelectronics has a large production capacity and low cost. In cooperation with Sanan Optoelectronics, in addition to reducing costs, the company can also use Sanan Optoelectronics to seize the mainland chip market.
For Sanan, with the increasingly saturated mid- and low-end chip market, gross profit margin dropped sharply, and Sanan began to exert its strength in the research and development of high-end LED chip products. At the same time, the market of Sanan Optoelectronics is mainly limited to the domestic market, and it is urgent to break the patent barriers and enter the overseas market. Yanyuan Optoelectronics has more than 200 patents in LED chip technology and is the ideal partner of Sanan Optoelectronics.
According to industry insiders, the main driving force for mergers and acquisitions among upstream chip companies is to expand production capacity and market, acquire new technologies and own each other's patents. Therefore, the companies they choose to acquire are companies with technology, patents or market advantages.
Middle and lower reaches: vertical integration to seize the market
Since 2012, the excess capacity of LED chips and packaging has made the entire industry exhausted. The focus of the industry's attention began to tilt toward the more market-oriented downstream lighting applications, LED lighting has become a new round of investment hotspots.
According to the survey data of the Higher Industrial Research Institute, in the first half of 2012, the overall size of China's LED indoor lighting market showed a substantial increase, with a year-on-year increase of nearly 36%. At the same time, the number of newly added LED indoor lighting companies is nearly 1,000. It is expected that in 2012, the scale of China's LED indoor lighting market is expected to exceed 25 billion yuan, a year-on-year growth rate of more than 40%.
At the beginning of last year, Ruifeng Optoelectronics, a well-known LED packaging company in China, signed a cooperation agreement with NVC Lighting to establish a joint venture company to develop and manufacture LED packaging products for lighting. The company's LED devices are mainly supplied to NVC Lighting.
Ruifeng Optoelectronics chose to cooperate with NVC Lighting, which is the winner of the channel. It is the abundant market channel resources of NVC, which opens up the estuary for Ruifeng Optoelectronics to enter the downstream LED lighting application. However, the project ended with Wu Changjiang’s departure.
Later, NVC chose to marry Dehao Runda, which is more representative. Dehao Runda claims to have a complete industrial chain in the LED field. However, it is understood that Dehao Runda's revenue in the LED field last year was less than 400 million yuan, of which 250 million yuan came from the previously acquired Ruituo display, removing chips and packaging. The revenue of Dehao Runda's LED lighting is less than 50 million.
NVC has mature channels and brand influence, but the OEM-based NVC field is still blank. Before the industry people asserted that the future LED lighting top ten will not appear in the shadow of NVC, so NVC's move seems to be accidental, it is inevitable.
For traditional lighting companies at the crossroads of transition, M&A is an important way to quickly intervene in the LED field.
In May of last year, 100% of the lighting spent 40 million yuan to acquire a British-owned LED lighting company. Prior to this, Sunshine Lighting won a 50% stake in Hangzhou Hanguang Lighting at a price of 13.5 million yuan. It also held a 30% stake in Japan's LIREN Company at a price of 1,233,600 yuan, and obtained the advanced technology of LIREN in the field of LED lighting.
M&A is easy to integrate
At present, the industry is in the post-shuffling era, and the tide of bankruptcy has occurred, including well-known enterprises such as Vision Optoelectronics, Haobo Optoelectronics, and Big Eye Optoelectronics, which have become the industry's "martyr." To develop, the prerequisite is to survive. As long as companies wishing to develop LED lighting are hoping to use M&A integration to compensate for their lack of LED products, brands and channels.
Due to the different entrepreneurs, the two companies in the early stage have obvious differences in management, culture and values. Therefore, the industry believes that although the transactions generated by mergers and acquisitions can be immediate, however, the expected benefits will be in the later run-in. Therefore, the effect of integration on the integration of enterprises cannot be pursued. It can only be gradual.
Just like the marriage between Dehao Runda and NVC, from the outside world, although the two companies are both listed companies, they are strong. However, the two companies had not performed well in the LED field before, and some even ridiculed the combination of the two is a "weak combination."
For NVC, how to rely on the advantages of Dehao Runda's upstream and mid-stream industry chain to quickly reduce costs and provide cost-effective products for its terminal marketing network, however, this is a bit difficult for the low-end Dehao Runda product; For Dehao Runda, I hope to use the mature brand and channel of NVC to break the 9 billion yuan investment and the sales situation is only 400 million yuan. However, NVC, which has just ended the infighting storm, needs time to fully recover its channel advantages.
However, whether it is upstream horizontal integration or vertical integration in the middle and lower reaches, the two sides must first clear their intentions and goals, patents? Talent? market? Then, according to the expected goals, we can work together to make better and farther.
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