In 2014, it was called the “M&A Year†of the global parts industry, and the mergers and acquisitions in the industry were surging. In the first half of the year alone, according to incomplete statistics, there are more than 30 auto parts companies in the world that have reported the acquisition or proposed acquisition. For example, the mainland wants to spend $1.9 billion to acquire Veyance, and ZF intends to acquire the US for US$12 billion. Tianhe, Johnson Controls acquired air distribution product suppliers, etc., from these mergers and acquisitions, found that automotive electronics, emissions, automotive interconnection, new energy has become a hot spot in this round of acquisitions, of which, there are 6 acquisitions from Chinese component companies. , accounting for nearly one-fifth. Shock Absorber Cover,Shock Absorber Dust Cover,Shock Dust Cover,Absorber Cover Ningbo Metal Sharing Supply Chain Management Co., Ltd , https://www.zenlesf.com
Technological change into the main driving force of this round of mergers and acquisitions The increasing emphasis on energy conservation, environmental protection, automotive intelligence and safety technology has become a new trend in the automotive industry. This is also reflected in the global auto parts merger this year: Samsung SDI will spend $3.3 billion to acquire the first woolen fabric to consolidate its business in the automotive lithium battery field. TE will spend $1.7 billion to acquire sensor manufacturers' precision electronics... More than a dozen M&A cases this year focused on automotive electronics, new energy, and emissions technologies. Technological change has become the main driving force behind this round of mergers and acquisitions.
In April, American power supplier BorgWarner announced that it had completed the acquisition of Gustav Wahler GmbH in Germany. Wahler is a company specializing in the production of exhaust gas recirculation products (EGR), including Daimler, Volkswagen, BMW and General Motors. BorgWarner said the acquisition will strengthen BorgWarner's market position in fuel economy and emissions. In addition, Visteon acquired Cooper's standard thermal management and emissions product line, and the mainland acquired a 50% stake in the company, which is owned by GKN. The focus of the acquisition is also focused on the field of automotive emission technology.
Since the beginning of this year, there have been three acquisitions involving the automotive electronics sector. Visteon acquired Johnson Controls Automotive Electronics, Vodafone acquired the Italian company Cobra to enter the automotive electronics, and TE acquired the sensor manufacturer's precision electronics. Among them, it is worth noting that TE spent $1.7 billion to acquire precision electronics.
As one of the world's leading sensor manufacturers, precision electronic sensor products can cover pressure sensors in brake systems, liquid characteristic sensors for liquid quality monitoring, humidity and temperature sensors for engine control, and electronic assistance. In various fields such as the tilt sensor of the brake system, TE's acquisition of precision electronics is of great significance for its further enhancement of its competitiveness in the automotive electronics field.
Cross-border acquisitions have become a trend in the global parts industry In response to the wave of new energy vehicles and car networking, cross-border acquisition has become a convenient way for many traditional parts companies to enter new fields. For example, GKN spent £8 million to acquire the Williams Hybrid Business Unit; Nippon Electric Company’s $100 million acquisition of the A123 Energy Solutions business.
The comprehensive parts giants such as Johnson Controls and Continental Group are reviewing the situation and constantly divesting the traditional and low-end parts business, strengthening the competitiveness of the core business, and starting to expand the non-automotive field from the overall development strategy of the group. Acquisition. In the first half of the year, Johnson Controls invested US$1.6 billion to acquire an air distribution technology company in Canada as an important step in its expansion in the construction sector. At the same time, Johnson Controls has continuously divested its auto parts business such as automotive electronics and interior parts. Continental wants to acquire Veyance for $1.9 billion to expand its business outside the automotive industry.
There are also some non-automotive companies that are optimistic about the automotive parts sector. The Vodafone Group of the United Kingdom intends to enter the automotive electronics industry through the acquisition of Italian Cobra, which is a more typical case of cross-border acquisition. As one of the world's largest mobile communication network companies, Vodafone clearly has rich resources and technical advantages in the field of automotive electronics and vehicle networking. The Cobra products it plans to acquire are mainly related to automotive safety, telecommunications and vehicle tracking for the automotive and insurance industries. The customer resources are mainly concentrated in car companies such as Renault, Toyota and Ferrari and some insurance companies. Optimistic about the auto parts field, not only the Vodafone family, this year, Russia Petroleum entered the car tire field by acquiring a 13% stake in Pirelli.
The integration of traditional business areas is still the mainstream. The technological change in the automotive industry is an important reason for many M&A. In order to follow the development of new energy vehicles and vehicle networking technologies, many traditional parts companies have entered the new fields with capital power. Therefore, there have been many “cross-border†acquisitions in the global auto parts industry this year. However, the M&A cases in China's parts and components industry are still mainly concentrated on traditional business integration and market scale. This may also objectively reflect the current status of the development of China's auto parts industry.
In the first half of this year, China's parts and components companies participated in four international acquisitions, namely, China Capital Capital plans to acquire Jaguar Land Rover supplier Sertec for 920 million yuan, and the winning subsidiary Puri acquires assembly line developer IMA, Zhuzhou Times New Materials. Acquired the metal rubber business of ZF, and acquired the acquisition of North American automotive plastic fuel tank enterprises. These mergers and acquisitions include stampings, exhaust pipe trims, cable products, cast iron cylinders, airbags, seat belts and steering wheels, automotive shock absorbers, fuel tanks, and more. Among them, the metal rubber product business unit of ZF, which was acquired by Zhuzhou Times New Materials of China South Locomotive Co., is the largest acquisition project of auto parts companies in Europe at present. The core assets involved in this transaction are automobile vibration damping systems. Famous brands and global annual sales of about 700 million euros. However, as can be seen from these acquisitions, based on the expansion and supplement of the original business of the enterprise, it is still the mainstream idea of ​​the acquisition of local parts and components enterprises.
The Huayu Automobile Holding subsidiary plans to acquire Nanqi Mould. Yuchai bought out 49% of the Yuchai Remanufacturing Company held by Caterpillar. It is based on the integration of resources within the company. There is not much from the acquisition itself. New ideas. Recently, Huayu Automobile reported the acquisition of a 50% stake in the German KSPG Group subsidiary. It is reported that Huayu Automobile will take advantage of this acquisition to upgrade its lightweight application technology in engine blocks, body structural parts and other components, and expand the global business of automotive cast aluminum. Such acquisitions are still the integration of traditional businesses.
Financial capital plays an important role in mergers and acquisitions In the first half of the six-company acquisition, it can be seen that many private equity funds and investment companies have become an important part of component acquisition. For example, in March of this year, the industry’s first capital for the purchase of British component manufacturer Sertec was an investment company that was just established in Hong Kong. It is understood that the company mainly invests in industrial equipment and biotechnology industries, with a registered capital of 8 One hundred million U.S. dollars. The controlling shareholder of YAPP Auto Parts Co., Ltd., China's largest fuel tank manufacturer, acquired all the shares of Canada's ABC Group's Oil Box Company and its US-based Gallatin plant in Tennessee, and also through its overseas investment and financing platform. Completed.
Also in April of this year, Fangyuan Capital, a Chinese private equity firm, reported that it was close to the acquisition of Key Safety Systemes. Fangyuan Capital is headquartered in Shanghai and its assets under management are approximately $2.4 billion. The successful acquisition of Gabriel will be the company's first investment in a US-based company.
Last year, Chunhui Capital acquired the Belgian Bunge automatic transmission company through the fund company. Wande Automobile Group Co., Ltd. introduced a private fundraising company to be a shareholder, etc. It can be found that these different backgrounds of financial capital are more and more active in the automotive industry. . However, I believe that these companies do not intend to really intervene in the operations of the acquired companies, but more to re-integrate the packaging for the acquired companies, so that they can be packaged again. One thing that can be affirmed is that these financial resources, which are more well-informed and have more experience in international M&A, will play an important role in promoting mergers and acquisitions and joint ventures between local parts and components.
Overseas mergers and acquisitions are a powerful way to adapt to the rapid development of domestic automobiles. Although overseas mergers and acquisitions have become an important form of domestic enterprises' foreign investment, for Chinese auto parts companies, choosing overseas mergers and acquisitions is also a solution to the dilemma and adapt to the rapid development of domestic autos. meter. It is reported that China currently has a huge market for auto parts sales, and 70% of its shares are occupied by foreign capital or joint ventures. Due to the decentralization of China's parts and components enterprises, and the differences in technology research and development, product structure, quality and cost control with international standards, many domestic component companies are plunging into strengths that cannot compete with multinational giants. Lose the danger of the traditional market.
In the past 10 years, China's automobile production and sales have quickly jumped to the top in the world, and the still huge market potential is still favored by most automobile brands. Not only some car brands in the design more consider the needs of Chinese consumers, the product incorporates more Chinese elements; and some car brands continue to look for partners in the country, hoping to achieve localization. However, Zhang Meiying, vice chairman of the National Committee of the Chinese People's Political Consultative Conference, believes that although China's auto industry is developing rapidly, the structural contradictions are extremely prominent. In particular, the core parts and components are still subject to people, which has seriously affected the overall development of China's auto industry.
At the same time, the Chinese auto market is facing the world's major parts companies entering China. Bosch Automotive Chassis Control System settled in Chengdu, Magna Powertrain System Tianjin New Plant was laid, and Delphi Packard Electronics/Electrical System opened its 10th factory in China. Visteon moved its Asian headquarters to Shanghai and plans to reach two in China. The number of Japanese 50 accessory companies has settled in Jiang Danyang and other indications that multinational parts companies have accelerated their development strategies in China, and many of them regard China as an important technology research and development center.
China's auto parts companies, which are in an unfavorable position, have begun to break through the trend and step up overseas mergers and acquisitions to narrow the technological gap between themselves and global parts companies, meet the needs of the domestic market and achieve the goal of entering the international market. Starting from Geely Automobile's acquisition of Australian transmission manufacturer DSI for US$40 million, domestic auto parts companies are looking for opportunities to go global. Under the continuous influence of the European debt crisis, the performance of many foreign component manufacturers has fallen sharply, providing “time-of-day†for overseas mergers and acquisitions of domestic enterprises. Through overseas mergers and acquisitions, domestic component companies not only acquired international advanced technology, improved their independent research and development capabilities, but also improved their position and profitability in the industrial chain. At the same time, it can also leverage the advantages of foreign capital to have a wide range of overseas markets, as well as advanced production, quality control and management experience, to expand its product structure and industrial value.
The author believes that the overseas acquisition of Chinese component companies has become a trend, and the overseas acquisition of parts and components is still more inclined to consider the development of industrial strategy. In accordance with the previous development model, the domestic market has not been exchanged for technology, and it has encountered bottlenecks in development. Therefore, companies now have to transform their development ideas and make direct overseas acquisitions.
The purpose of overseas acquisitions is to absorb the excellent management methods and production processes of overseas companies in order to improve their core competitiveness. Only by integrating the acquired companies, China's overseas acquisitions can be truly realized.
In this regard, relevant industry experts said that the state should give policy encouragement and support to the auto parts industry, especially the key parts and components and the automotive electronics industry. We will encourage domestic enterprises to acquire core component companies and overseas R&D institutions with advanced technology, and provide support and assistance in terms of policies and funds. At the same time, China can also systematically send technicians to foreign companies for mergers and acquisitions to study and experience advanced automobile culture and concepts. It is also a good way to rapidly improve the comprehensive competitiveness of China's auto parts industry.