Ministry issued heavy file PV merger and reorganization of enterprises by the end point

Polaris solar PV net news: end of year, PV industry positive. On December 31, 2014, the Ministry on further optimizing the PV market environment of merger and reorganization of enterprises (hereinafter referred to as observations) introduction this article caused uproar in the PV, can be said to support the development of photovoltaic industry heavy files, is of great significance for the development of PV industry in 2015. Why do countries Ministry when discarding this file? 2015 development of the photovoltaic industry has positive, how we understand. Next, author of the photovoltaic industry reality, to talk about his own humble opinion.

Introduction the opinion are then

Someone asked, either early or late, the State Ministry RAM in the final day of this file, why the Ministry of national introduction this article at this time? This is really a question. Said this before, we’re simple review the ups and downs of the photovoltaic industry in recent years.

Let us return to the beginning of 2010, when spread on the land an investment boom, mainly focused on silicon wafers, cells, modules and other photovoltaic industry. Investment boom has brought excess capacity and overcapacity will inevitably bring about a price war, with the first half of 2011, expansion focused on production, the industry soon be marred by vicious price wars, which further led to a drop in the price of international market turmoil and raised in 2012, United States, the European Union’s “double reverse”. After the loans to expand production capacity of the photovoltaic industry, not a few days days, went to 5 consecutive quarters of losses. By the end of 2013, the industry leading enterprise debt rate at between 80% and 85%, even more than 90% individual enterprises. Changes in the relationship between supply and demand on the market must cause a change in industrial development, market brought spontaneous adjustment in recent years of a bankruptcy, merger, reorganization, merger ever. By the end of 2014, the United States, Canada and other countries once again to launch a new round of trade barriers, exports in the international market therefore blocked; all of these factors make our PV industry is trapped in a cage, to extricate themselves. Business sustain, many big companies went bankrupt, what should I do, only for change, reorganization, consolidation, there will be a new way out.

In view of this, place this file on the last day of the National Ministry of the RAM is a complex background. Increased competition are key factors in promoting mergers and acquisitions occur, with the accelerated pace of economic globalization, Governments, businesses and markets are inundated with information failure, directly led to overproduction. Enterprises want to compete worldwide, Alliance must open up the markets, to restructure to cut costs, thus improving efficiency. While the merger and reorganization of enterprises, especially mergers and acquisitions, efficiency decline in response to competition is a good way.

Corporate mergers and acquisitions aimed at changing and straighten out the relationship between supply and demand in the market order, and reallocation of economic resources, and maximizing profits. Thus, in the case of current photovoltaic industry experienced several unfavourable factors, countries the Ministry on further optimizing the PV industry mergers and acquisitions market environment views: it’s time!

In fact, in recent years, with malaise, capital chain rupture of the photovoltaic industry, merging the PV industry has emerged, bankruptcy m real often, is merely sporadic, has not attracted our attention. But I believe that issued the opinion will greatly promote mergers and reorganizations of PV industry in China. In 2015, Governments at all levels, driven by bankruptcy mergers and acquisitions, mergers and acquisitions will become the hot word, bankruptcy mergers and acquisitions mergers will be the new normal. As you can imagine, policy effects of day appears, the PV-wave of corporate mergers and acquisitions heating up. Meanwhile, mergers and acquisitions year there will be a number of new features and new trends.

The next few years, Chinese PV industry mergers and acquisitions will show five trends. First, merger and reorganization of enterprises, especially mergers and acquisitions will be associated closely with the PV industry structural adjustment. Second is mergers and acquisitions related to the environment could be improved continuously, and showed a more relaxed posture. Three is the enterprise strength, powerful alliances and other forms of coexistence, stock exchange, taking on debt, with stripping toxic assets will be the main means, the proportion will continue to increase. Four mergers in particular merger upsurge, involving not only rising merger will also benefit from horizontal to vertical, and then to mix steps of development. Five is a cross-regional mergers have become mainstream. There may even be a national and even global mergers, international corporate mergers and acquisitions activity will occur.

Views: 2015 development of the photovoltaic industry good

From the Ministry’s views content, files on the 2015 development of the photovoltaic industry plus is:

Are views out of trouble for the PV industry plays an important role. Now, PV may have had the most difficult stages, markets rebound sharply, industry, giving more than a good bet. But throughout the sheep development trajectory, still twists and turns upward, many difficulties still restricts photovoltaic development. Double negative survey, new trade barriers and other factors continues unabated; domestic economic growth slows, technology imports, industry overcapacity, financing, high cost, low efficiency and Enterprise losses and mounting debt problems daily at around PV. As Hamlet’s classic monologue: life or death? This is a problem.

Do? As the national level, is trying to revitalize photovoltaic, PV enterprises through mergers and reorganizations can be completely out of the Woods, do better and stronger. Merger and reorganization of enterprises is convenient way to become bigger and stronger. Through mergers and reorganization, enterprise development, making full use of land, human resources, technology, and other development factors, in the process of effectively integrating the allocation of resources to achieve low-cost, efficient expansion, merged enterprise can get rid of the big enterprises caught in order to survive the stress and hardships to win new opportunities and space. Practice has proved that, merger and reorganization of the main means of PV is completely out of the Woods. PV enterprises through mergers and reorganization in trouble regaining vitality.

Second opinion will promote the transformation and upgrading of the photovoltaic industry and improve industry concentration. The opinion notes that using global industry restructuring opportunities and comprehensive policy measures, optimizing the PV industry mergers and acquisitions market environment, boot speed up the transformation and upgrading of China’s photovoltaic industry, promoting the sustained and healthy development of the photovoltaic industry. Mergers and acquisitions will effectively improve industry concentration.

Industry practice has proved the argument. On one hand, can play the market economies of scale through mergers and acquisitions, improve concentration through mergers and acquisitions can be specialized for different market products and services to meet different consumer needs; can be concentrated enough funds for the research, design, development, and improvement of production technology and rapid introduction of new products, adoption of new technologies. On the, through merger on enterprise of assets for added and adjustment, to reached best economic scale, reduced enterprise of production cost; merger also makes company has conditions in keep overall products structure of premise Xia, concentrated in a area factory in the for single varieties production, reached specialization level; merger also can solution specialization production brings of series problem, makes each production process Zhijian organic to tie, to produced scale economic. In addition, the company expanded its financing capacity is greatly increased.

Third opinion will contribute to the promotion of core competitiveness of PV industry in China. Years of experience has shown that through m can effectively accelerate industry and enterprises ‘ core competitiveness. As we all know, cultivating core competitive power of transnational corporations, there are two ways: first, in multinational companies through long-term accumulation of knowledge learning, gradually nurturing; the second is through an external enterprise merger with core competitive power, or have the appropriate resources, through effective restructuring and integration. Core competence of enterprise and self-development component compared to merger with fast speed, availability and low cost and so on. To complete the resources from the search object to implement mergers and acquisitions, restructuring, but much faster than the building enterprises’s core competence is to; for that big companies need specific knowledge and resources dedicated to other businesses, mergers and acquisitions will become the only way to obtain such knowledge and resources.

Four views will accelerate the PV industry structure adjustment, promote sustainable and healthy development of the industry. Merger and acquisition is relatively one of the lowest-cost way to expand, of society. Accumulation and investment expansion, if not to premise the synchronous growth of the consumer market, inevitably resulting in an oversupply of products. Competition eliminated a group of companies, will result in a waste of social resources, enterprises can also cause loss of leadership in the industry expansion. Creative use of mergers and acquisitions (M&A) Act, which increased the competitiveness of enterprises, and make the enterprises to adjust an optimal structure; enterprises gain rapid expansion, achieve the best combination of business managers and owners. Chinese enterprises through mergers and acquisitions activity, can compete with large foreign enterprises formed the largest group, the better to attract foreign investment, greater agreement with large foreign enterprises, and cooperation in larger projects; from a sense, development is implemented by regularity of structure adjustment and transformation. Structural adjustment through technological progress, industrial transformation and innovation of enterprises, institutions and organizations, on the one hand to form a new point of economic growth, on the other hand eliminating backward production capacity, thus providing impetus for industrial development.

Five is the opinion of photovoltaic companies will create new market opportunities. Purchased and eaten by the acquiring company major competitors in order to reduce the level of keen competition in the industry. If internal accumulation or direct investment in leading companies in the industry, will put pressure on the other companies, if the rest of the industry began to follow suit, the industry would face an “accelerated expansion” of the competition. If an enterprise’s internal expansion rivals combined, is a Pyrrhic victory. Therefore, the merger before the competitors combined strong one or a handful of them, you can relieve the pressure on business. On one hand, enterprises can quickly access new market opportunities through acquisitions, does not increase the production capacity of the industry to achieve critical mass. By taking over a company network can immediately take advantage of readily available local suppliers and customers, and to obtain the appropriate skills. This kind of information, localization advantage for large companies is of special significance. Meanwhile, mergers and acquisitions can bring to the enterprise market power effect, with characteristics of oligopoly markets, the pursuit of market power and dominant market position is also a driving force in mergers and acquisitions.

By merger activity large enterprises can increase their market shares, with rivals to increase control of the market by reducing; vertical merger of big business by controlling a large number of key material and sales channels, effectively control the activities of competitors, raise barriers to entry in your field and business differentiators. In addition, synergies through mergers and acquisitions, improve industry efficiency. Pursuit of synergy can be static (such as a certain point reduce costs or increase revenues), or it can be dynamic (such as strengthening innovation). Including: the integration of the management resources, such as consolidation of office facilities and staff after reducing using each other’s marketing and distribution networks to boost revenue; purchasing synergy to strengthen bargaining power; production economies of scale lead to lower cost; for production, research and development or other activities to avoid duplication. Dynamic coordination may involve coordination of complementary resources and skills to enhance TNC innovation capacity, sales, market share and profitability have long-term positive effects. Strong competitive pressures, falling prices, overcapacity in the industry, dynamic synergy effects can be said to be of paramount importance.

But at the sight of these at the same time, we should also be sensible to see the drawbacks and risks: such as business size does not determine everything, sometimes unlimited expand enterprise scale and will limit the efficiency of enterprises and thus affect the efficiency of industry. There is only for mergers and acquisitions, forgot to establish corporate values system, ignoring the day-to-day operations while the main efforts for merger and acquisition activity, once a company decline, it will have an impact on long-term development. Coupled with mergers and acquisitions may bring rapid staff turnover, declining customer loyalty. If the lack of understanding between cultures, can also cause the acquirer and the acquired Chinese cultural barriers. So we need comprehensive and holistic learning spirit, correctly understand and handle the relationship between economies of scale and economies of scale, the relationship between capital operation and production management, as well as mergers and acquisitions and the integration of digestion, also should be handled properly in mergers and acquisitions will relations with the Government. Mergers are not simple displacement of the assets nor the messy patchwork of assets, it’s under the new uniform of business objectives and business strategy, play a coordinated combination of maximum effectiveness of both assets. Through mergers and reorganization of enterprise assets, and glow with new vigor and vitality.

Therefore, the mergers to reduce the Government’s behavior, don’t pull, and to follow the law of market development, in line with the principles of free will, freedom, confidence and realize the optimal allocation and mutual benefit between enterprises. Government has to be prepared for consequences of corporate mergers and acquisitions, and could not simply be the, big business is created, not bought. Today many merger and emphasize only the surface of the size of the market, rather than the actual integration of merger and acquisition among enterprises, the corporate merger often produced disappointing results. Relevant government departments should adopt legislation further defined forms of intermediaries, its responsibilities and norms and policy support for merger and reorganization of enterprises should be enhanced, encouraged by the market’s behavior achieved optimization of resources. (Author: Han Yongqi of Penglai city in Shandong province economic and Informatization)

Original title: Ministry introduced PV heavy file merger and reorganization of enterprises by the end point

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