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The lithium battery industry is struggling to survive, and many battery companies and mergers and acquisitions terminate
Ikang Technology terminated the acquisition of Xinchengtai, Baling Technology terminated the acquisition of Yuliang Battery, and Zhongli Group terminated the acquisition of BAK Power. In the past two months of 2019, there have been three failures in the merger of lithium battery companies.
According to incomplete statistics from a reporter from the Beijing News, there were more than 10 incidents of termination of lithium battery acquisition in 2018. This unfavorable situation also continued into 2019.
According to the 2018 annual performance reports released by a number of listed power battery companies, most of the The chain is tense. From the perspective of the industry, there are still many crises and pressures hidden in the power lithium battery industry. The deep reshuffle of the industry has started, the concentration will become higher and higher, and more and more people will be out.
Since 2018, there have been 13 merger failures.
After nearly a year of preparation, on January 11 this year, Zhongli Group issued an announcement stating that the company has decided to terminate its plans to acquire Shenzhen BAK Power Battery Co., Ltd. (hereinafter referred to as 'BAK Power'), a top power battery manufacturer, and one of its future business plans will focus on the field of military electronics. Previously, Zhongli Group planned to issue shares and pay cash to acquire shares of BAK Power held by counterparties including Shenzhen BAK Battery Co., Ltd. and Tibet Haoze Trading Co., Ltd. The transaction price is expected to reach 10 billion yuan. .
As for the reasons for the termination of the acquisition, Zhongli Group stated that it was due to the large fluctuations in the secondary market, deleveraging and other macroeconomic environmental factors during the planning of the major asset reorganization, combined with The actual situation of the target company and the company's future development plan have created greater uncertainty for this major asset reorganization.
Coincidentally, on January 18, Auto Parts Manufacturing Company Baling Technology issued an announcement stating that the company will terminate Suzhou Yuliang Battery Co., Ltd. (hereinafter referred to as 'Yuliang Battery' ) Intention to acquire equity. As early as May 17, 2018, Baling Technology announced that it had signed a 'Letter of Intent for Equity Transfer' with Shanghai Kailong Investment Management Co., Ltd., the controlling shareholder of Yuliang Battery, and intends to transfer 20%-30 of its holdings of Yuliang Battery. % Equity. According to the disclosure at the time, the overall valuation of Yuliang Battery was 2.8 billion-3.5 billion yuan. Regarding the reason for the termination of the acquisition, Baling Technology said that after signing the letter of intent for cooperation, the company did not conduct due diligence on the target company. So far, there has been no substantial progress, and both parties agreed to terminate the transaction.
In early February, Jiangsu Akcome Technology Co., Ltd. (hereinafter referred to as 'Aikang Technology'), the leader in photovoltaic accessories, also issued an announcement to terminate the purchase of Shenzhen Xinchengtai Technology Co., Ltd. . A reporter from the Beijing News noticed that in order to acquire Xinchengtai, Akcome had been preparing for nearly eight months. In September 2018, Akcome Technology issued an announcement stating that it plans to purchase 100% equity of Xinchengtai, an automated production equipment for lithium batteries, through shares, with an estimated value of 397 million yuan. Akcome explained the reasons for the termination of the acquisition and stated that during the negotiation process, the two parties could not reach an agreement on some of the terms of the agreement and decided to terminate the plan for the issuance of shares to purchase assets.
According to the Beijing News reporter’s incomplete statistics, in 2018, including Sino-Portugal’s termination of the acquisition of salt lake lithium assets, Jingwei’s acquisition of Kawei failed again, and Gree Group’s The 5.2 billion tender offer to acquire 20% of Changyuan Group's shares fell through, and there were more than 10 incidents of termination of the acquisition of lithium batteries. This means that from 2018 to the present, there have been 13 cases of failed mergers of lithium battery companies.
The performance of many battery companies fell short of expectations
An analyst from China International Finance Securities told the Beijing News reporter that with With the implementation of the new subsidy policy, the risks brought by the acquisition of the power battery industry are also increasing. With the scarcity of high-quality targets and intensified market competition, power battery mergers and acquisitions have gradually become rational.
At the same time, due to the decline in financial subsidies for new energy vehicles in 2018 and the increase in the prices of upstream raw materials, the cost pressures of mid- and downstream companies in the power battery industry chain continue to increase. Affected by this, many battery companies performed poorly and even lost money in 2018.
Among the 19 lithium battery companies that released the 2018 performance bulletin as counted by reporters from the Beijing News, 11 had a decline in their net profit. Among them, the net profit of Mengshi Technology declined the most, with a year-on-year decline of 1530.10%. The net profit of enterprises such as Dongfang Precision, Roshow Technology, *ST Yufu, Jiawei New Energy, and Zhihang New Energy fell by 2-7 times. CATL’s net profit reached 3.58 billion yuan, making it the most profitable battery company, but it also experienced a slight decline. In previous years, the leading power battery company Jianrui Woneng had a huge loss of 3.82 billion yuan in net profit in 2018. In addition, the performance pressure of Tianqi Lithium and Ganfeng Lithium is obvious.
As performance is under pressure, it is inevitable that power battery companies will accelerate differentiation. According to statistics, as of August last year, the number of domestic power battery-related supporting enterprises has dropped from 150 in 2015 to about 100. This means that in less than 3 years, 1/3 of power battery companies have been eliminated.
The above-mentioned analysts pointed out that with the government’s tightening of new energy vehicle subsidies, coupled with the frequent deployment of power battery companies in Japan and South Korea, fierce competition inside and outside In the environment, the new round of reshuffle of China's lithium battery industry will be more severe.