Overseas Mergers And Acquisitions: Technology Driven

If last year, Ningbo cistar Limited by Share Ltd succeeded in acquiring Switzerland. group This is only a case of overseas mergers and acquisitions in the industry. This year, China Hi-Tech Group Corporation's acquisition of Hongkong Lixin industrial group and ericon newmager combing business unit is enough to push overseas mergers and acquisitions from "case" to "phenomenon" category.

When the domestic textile machinery enterprises are worried that they can not catch up with foreign advanced textile machinery technology, foreign textile machinery enterprises are also looking for ways to fully enter the world's largest textile machinery market. The complementarity between this technology and the market will become the main opportunity for the global integration of resources in the textile machinery industry, transnational enterprise cooperation and overseas mergers and acquisitions.

At present, most of the mergers and acquisitions of textile machinery enterprises are represented by capital or equity. strategy Therefore, the purpose of overseas mergers and acquisitions of textile machinery enterprises is obviously more direct and clearer, that is, to acquire advanced textile machinery technology abroad, and the target of mergers and acquisitions refers to the overseas advanced textile machinery technology groups.

High threshold for overseas mergers and acquisitions

Ningbo cistar Limited by Share Ltd has completed a wholly-owned acquisition of the world's third major computerized flat knitting machines, which are the world's third largest computerized flat knitting machines with net assets of 22 million 483 thousand euros, and Italy's fashion design center and Shanghai Textile Machinery Co., Ltd. Zhuyu's successful case shows that strong financial strength is a prerequisite for enterprises to achieve overseas mergers and acquisitions.

However, when the enterprises that meet the conditions of merger and acquisition funds are on the same line, the amount of capital is not the decisive factor for overseas enterprises to choose to buy the company.

In mergers and acquisitions, the ability of an enterprise is an enterprise. Success The key to M & A. In the Journal of Ningbo University published in May this year, Sun Pingfan, chairman of Ningbo Cixing Limited by Share Ltd, expressed this view in analyzing the company's takeover case. Sun Pingfan believes that such enterprises' capabilities lie in decision-making, human resources and technology. Specifically, enterprises need to have keen strategic discernment, managers should have decisive decision-making ability, enterprises should have young and high-quality talent pool, have effective and harmonious business capabilities, be familiar with the market and master international operations; enterprises must have their own brands, independent technology and excellent product quality.

Another factor that can not be ignored is the local advantages of Chinese enterprises in the domestic market. Chen Xiaohong, director of the Enterprise Research Institute of the State Council Development Research Center, believes that Chinese enterprises have their own advantages in overseas mergers and acquisitions, that is, obvious procurement, sales and service advantages in the Chinese market. "Relying on China's market advantage value chain integration mode, Chinese enterprises can rely on large scale and fast growing domestic market advantages to acquire foreign companies with higher technology level, and enhance the technological advantages of R & D and manufacturing of Chinese enterprises through value chain integration and technology digestion and absorption."

In addition, the so-called "good birds choose wood and live", enterprises in the process of mergers and acquisitions "first impression" is also crucial. As a concentrated embodiment of soft power and "first impression", factors such as social prestige, responsibility image and management experience of enterprises and their leaders are also the intangible threshold set by candidates for M & A.

Technology driven factors

Nowadays, overseas mergers and acquisitions, in essence, are caused by the company's capital. Merger It is an equal cooperation, mutual aid and win win relationship with the enterprises that have been acquired.

The determination of M & a industry is closely related to the strategic layout of enterprises. As the first brand of Chinese flat knitting machine, Ningbo Cixing Limited by Share Ltd chose "strengthen the strong" and take the global four major computerized flat knitting machine manufacturers as the primary goal of mergers and acquisitions, in order to achieve further flight of technology and products in the flat knitting field that they are good at. As the largest spinning group of China, the Limited by Share Ltd group of China Heng Tian group chose to use "long board short board" to further enhance the strength in dyeing and finishing equipment and nonwoven equipment, and achieve globalization.

For domestic spinning machinery enterprises with overseas M & A conditions, choosing the right "marriage" target is a crucial step in the process of strategic expansion. Although textile machinery enterprises choose technology as the driving factor without exception, there is a contingency of "looking at the right eye" in the process, and it is inseparable from scientific and meticulous objective comparison and growth prediction.

Heng Tian is "the first sight love" for the world's best and largest dyeing and finishing manufacturer Lixin group. The two sides expressed their willingness to cooperate in 1999. Later, influenced by the environment of the textile industry, cooperation failed. After that, Heng Tian kept a low profile and secretly accumulated the strength of mergers and acquisitions. In 2008, the two sides launched substantive negotiations on mergers and acquisitions, and after 3 years, they finally reached a takeover agreement.

Compared with Heng Tian, cistar's choice of M & A targets is more tortuous. The ability and strength of Japan island and Stoll, Germany, were first excluded. After thinking about the potential and appreciation space that Target Corp might bring after its acquisition, Cixing gave up the acquisition of Prouty in Italy, because Prouty was leading in technology, but the brand influence was gradually marginalized. While Switzerland is set up late, but the independent R & D technology is relatively mature, since the 80s of last century, there have been many invention results, which shows that it has been pursuing innovation and constantly improving its brand effect. On the other hand, affected by the international financial crisis. Influence In the event of a loss, he hopes that powerful companies will inject funds to solve the crisis facing enterprises, which ultimately provides an opportunity for the successful acquisition of cistar.

It is understood that under the influence of the global financial crisis, the valuation of foreign textile machinery enterprises, including advanced technology and brand, is still at a historic low. In addition, the trend of European and American market withdrawing from the industry is becoming increasingly obvious. The overseas textile machinery enterprises' future "strength" is not an effective way to solve the existing domestic technology bottlenecks.

Integration and integration

It is only a year since the takeover of Tzu star, but it has been a long time since the acquisition of Li Xin, and the more pressing issue has been placed in front of the two enterprises.

The problem of absorption and digestion after purchase lies in all aspects of thinking mode, management culture and product concept. The real test has just begun for the successful acquisition of overseas enterprises.

It is reported that after the acquisition of TSE, the Swiss R & D base was developed as a new product development platform. The research and development products were first produced in Shanghai in small batch production. After the technology was mature, they were transferred to Ningbo for large-scale production. Combined with the advantages of foreign R & D and local low-cost production advantages, a new computerized flat knitting machine with high performance price ratio and high technology content was produced.

The integration of technology only needs to cross geographical boundaries, and the integration of management needs to transcend cultural barriers. Because overseas textile machinery enterprises have advanced enterprise management system and excellent management team, both enterprises choose to maintain relative independence of overseas business management and mechanism.

Sun Pingfan pointed out that Cixing adopted the strategy of "cultural integration". The premise of integration is to respect each other and carry out the management method of "participation not dominant". The personnel and equipment in foreign countries are not moving, and send people to study abroad, promote each other and develop each other, thus enhancing the operation efficiency after M & A.

Similarly, Heng Tian Group Buy It will also retain the core team and business structure of Li Xin, and cooperate with Li Xin in the field of dyeing and finishing equipment. For example, the sales system of the textile machinery in the mainland can complement each other with the global marketing network of Lixin, and the financing platform of Heng Tian can provide financial support for Lixin's customers.

Let us wait and see whether the "two" individuals of "1+1=2" before acquisition can realize the synergistic effect of "1+1>2" after takeover in collision and integration.