The hottest and most remarkable acquisition of Puy

2022-07-23
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Remarkable: Zoomlion's acquisition of Puyuan

Guide: after nearly two years of negotiation, the two giants in the domestic mechanical engineering industry finally joined hands. On August 30, the listed company Zoomlion and the state-owned enterprise Puyuan Group officially signed a restructuring and merger agreement, announcing that they would jointly build the largest truck crane production base in China. In the domestic construction machinery industry

after nearly two years of negotiation, the two giants in the domestic mechanical engineering industry finally joined hands. On August 30, Zoomlion, a listed company, officially signed a restructuring and M & a agreement with Puyuan group, a state-owned enterprise, announcing that it would jointly build the largest automobile crane manufacturing base in China. Under the background of the booming domestic construction machinery industry, this "active M & a" behavior has attracted the attention of

. Insiders believe that this move will change the pattern of the domestic construction machinery industry. In the next three to five years, when the tariff is increased to 25%, it may also trigger a wave of restructuring and mergers in the

industry

plan ahead to promote restructuring and M & a

on the surface, the whole process of this M & A is quiet, but there is a profound industry background behind it

the construction machinery industry is a rapidly developing industry in China in recent years. Since 2000, the market of construction machinery industry has continued to blow out, and there has been a rare general boom in the whole industry. The annual average growth rate of profits and sales of the industry has exceeded 35%

the apparent prosperity of the whole industry can not cover up the potential crisis. Domestic construction machinery enterprises are always facing a problem that the production scale and

technical level need to be improved. Although the sales revenue of the whole industry reached 77.3 billion yuan and the profit reached 46.

400million yuan in 2002, compared with the international construction machinery giants, China composite exhibition is still the largest and most influential composite event in the Asia Pacific region. It is reported that the sales revenue of a US caterpillar company in 2002 exceeded 20billion US dollars, more than twice the total sales revenue of the whole industry in China. Under the background of China's accession to the World Trade Organization and the gradual integration of the global economy, the voice of resource integration in China's construction machinery industry is growing

since its listing in 2000, Zoomlion has seized the opportunity of the rapid development of the construction machinery industry, and its performance has been showing a trend of

stable growth. The average annual growth rate of its main business income and net profit has reached more than 50%. However, the construction machinery industry is a cyclical industry. The sharp growth in market demand in the past two years may overdraw the future growth of the industry

in such a market environment, if enterprises in the construction machinery industry still expand by means of new investment, the return period of investment will be relatively long, and enterprises may miss sharing the overall benefits brought by the substantial growth of the industry. Zoomlion can effectively solve the above problems by acquiring the main operating assets of Puyuan group and

Puyuan Co., Ltd. Zoomlion makes use of the high-quality assets of Puyuan group to carry out sustainable production and operation. It can not only fully grasp the development opportunities brought by the rising cycle of the industry to the enterprise, quickly realize product diversification, expand revenue and asset scale, and enhance the comprehensive strength of the company. At the same time, the company's anti risk ability can also be improved in the future when the industry growth may slow down

a win-win "strong alliance"

M & A is often a game of "the jungle", but the restructuring and M & A between Zoomlion and Puyuan is a "strong alliance"

the predecessor of Hunan Puyuan group is a third tier enterprise moving from Shanghai to Hunan. In the late 1990s, the company implemented the debt to equity swap of state-owned enterprises, which renewed its vitality. From 2000 to 2002, Puyuan group showed good growth, and its sales revenue increased from more than 300million yuan to 1.07 billion yuan

Puyuan group is mainly engaged in truck cranes, special vehicles and construction machinery. Puyuan group has long accumulated technical and manufacturing advantages in the field of truck cranes. As early as the 1970s and 1980s, this enterprise was one of China's four major truck crane manufacturers. In recent years, the truck crane business of Puyuan group has maintained a rapid growth momentum, with a market share of 1

4.07%, ranking second only to Xuzhou Heavy Machinery Factory

In 2001, Hunan Province, a major agricultural province, put forward the development strategy of accelerating the process of industrialization. The provincial leaders decided to take the construction machinery industry as the leader of the industrialization of the whole province after the adjustment of

research. They hoped to form a "construction machinery City" with a sales revenue of more than 10 billion yuan in Changsha within 5 to 10 years and become a processing base of the global construction machinery industry. This strategic decision provided a rare opportunity for Zoomlion, which has always hoped to expand at a low cost

through the "matchmaking" of the local government and the hard negotiation in the past two years, the two major construction machinery enterprises in Hunan province finally came together. First, Zoomlion acquired the main operating assets of Puyuan Group Co., Ltd., making Puyuan Engineering Co., Ltd. a wholly-owned subsidiary of Zoomlion with an annual revenue of about US $15billion. On this basis, Zoomlion further restructured and established a diversified equity structure with Zoomlion holding, operating and technical backbone shareholding, forming an interest platform for the state, enterprises and backbone teams. Under the new mechanism and new investment, Realize the high-speed development of the enterprise. Other assets of Puyuan Group Co., Ltd. that have not been acquired into Zoomlion are transferred to Changsha

Construction Machinery Institute (the "controlling party" of Zoomlion) and continue to exist in the name of Puyuan group

in this way, Zoomlion will, with the help of the financing platform of listed companies, integrate the construction machinery industry in Hunan, especially Changsha, through the three links of technology, market and capital, and quickly become bigger and stronger in the extensive expansion. Puyuan Group Co., Ltd. has straightened out the labor relations and transformed the operating mechanism, stripped off the social functions of enterprises, and with the help of Zoomlion's listed company platform, obtained the funds needed to expand investment, and quickly entered a new stage of development. Zoomlion plans to develop the integrated enterprise into a large enterprise group with sales of more than 10 billion yuan and profits and taxes of nearly one billion yuan in about five years

Zoomlion

as early as 1997, Zoomlion had proposed to link the domestic construction machinery industry by taking technology, capital and market as the link and by means of equity participation, holding, joint

merger and acquisition. Due to the immature conditions at that time, Zoomlion had been carrying out internal integration and accumulating strength. Since 2001, the introverted Zoomlion has officially started its own low-cost expansion

different from the industry diversified expansion concept of "not putting eggs in the same basket" adhered to by other enterprises, Zoomlion has set its sights on top enterprises in different fields in the industry from the very beginning

in 2001, Zoomlion first extended its reach to the UK, and took the lead in the world's trenchless technology, British baolujie company, under its command, laying a good foundation for enterprises to graft international advanced technology at a high level and gain insight into the world's technological development frontier

in 2002, Zoomlion merged Hunan Machine Tool Plant, known as the "king of band saw in China", which not only possessed the strongest band saw processing technology in China, but also alleviated the increasingly insufficient processing capacity of the enterprise to a certain extent

the recent restructuring and acquisition of Puyuan group by Zoomlion is undoubtedly another opportunity for Zoomlion to take off. From the perspective of the structure of the main business,

due to the good business complementarity between Puyuan group and Zoomlion, the alliance of Puyuan group will greatly enrich and

improve the product chain of Zoomlion's engineering cranes. At the same time, by injecting capital and management, it will become the largest R & D and manufacturing base of automobile cranes in China, thus increasing the revenue scale and profitability of Zoomlion's crane business

it is reported that in the next five years, Zoomlion will invest nearly 2billion yuan to expand its production scale, transform its strong scientific research and development strength into advanced production and manufacturing power, and form the most advanced and largest modern comprehensive construction machinery production base in China and even in Asia

[comment: from the expansion track of Zoomlion, the principle it follows is identity and adaptability. Whether it is the acquisition of British "baolujie" company, the merger of "Hunan Machine Tool Plant", or the entry into "Puyuan", it integrates the market of the same product, and then gradually eliminates the merged company by taking advantage of the advanced technology, abundant capital and the mature management system and operating mechanism of the listed company, forming the effect of 1 + 1 greater than 2.]

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