Will mergers and acquisitions in 2019 be the way for enterprises to rise?

With the gradual development and growth of enterprises, it has become an important measure in the development of enterprises to create industrial diversification, increase market occupation, defeat competitors, and make full use of B enterprise resources to consolidate the global status of enterprises.

Since 2019, the acquisition of coatings industry has continued. So far, PPG, Libang, Sto Group, Akzo Nobel and so on have completed the acquisition. In the choice of mergers and acquisitions, enterprises are to expand the scale of production and operation, reduce costs, increase market share and enhance the strategic position of the industry, obtain sufficient and cheap raw materials and labor force to enhance the competitiveness of enterprises, and implement brand management strategy to enhance the visibility of enterprises in order to obtain excess profits.

In May 2019, Ribon Governor Runfa officially acquired Jiadebaoman New Technology Material Co., Ltd. After the acquisition, Jiadebaoman continued to retain all the original management team and business model; in June, Ribon Mother Company acquired Betek, a Turkish paint manufacturer, and nine of its subsidiaries, and established them as subsidiaries. Ritu Holdings, the parent company, said the acquisition would create a more balanced regional portfolio and significantly help to improve corporate and shareholder value; in August, Ribon completed its acquisition of Dulux Group, Australia, and Ribon Coatings agreed to buy Dulux Group for A$9.80 a share, which is The deal valued the Australian company at A$3.8 billion.

The cooperation between Libang and Jiade Baoman will better play the synergistic role of UV+water, better realize the complementarity of customers, channels, products and technology, thus providing a comprehensive solution of oil-to-water conversion, thereby enhancing customer service capabilities. The acquisition of Dulux Group in Australia by Libang will help Libang to ensure a strong position in the field of architectural coatings with huge global demand for coatings and still room for development, and help it to lay out its market areas so as to achieve a balance of development, thereby further consolidating the company's business foundation and operating in the medium term. The promotion of the plan has made great contributions.

At present, Lebanon is in the process of a three-year medium-term business plan starting in 2018, which aims to establish an overwhelming position in Asia, accelerate global development and become a leading company that continuously creates new values. In order to achieve the goal, Libang is focusing on four key measures: strengthening market segmentation business; accelerating portfolio expansion (mergers and acquisitions); improving profitability (14% operating profit rate after investment growth); and strengthening the operation of the "global first team". Therefore, over the past two years, Libang has frequently challenged the M&A market.

In March 2019, PPG completed its acquisition of Whitford Worldwide Company; in April, PPG completed its acquisition of Hemmelrath, an automotive paint manufacturer; and in August, PPG completed its acquisition of Dexmet, a special material manufacturer. The acquisition of Dexmet was aimed at enhancing the product line of PPG, expanding its R&D capabilities, and increasing its presence in PPG aviation. Today, the market scope of automotive and industrial coatings business provides customers with further value. Not long ago, in October 2018, PPG acquired SEM, a professional automotive repairing paint manufacturer based in the United States. On the way of acquiring enterprises, PPG is also following the trend. In July, Akzo Nobel announced plans to acquire Mapaero, a French aviation coatings manufacturer. By combining the expertise of both sides, Akzo Nobel will be able to strengthen its global position in the stable growth of the aviation coatings market. In addition, BASF Paint Department acquired Polymer's automotive paint debonding business;

Sika Group acquired Paris Group in January to increase its business in mortar and waterproof, which is also a win-win deal;

Three Trees acquired Dayu Leak-proof business in January, which also indicates three. Keshu formally entered the field of waterproofing;

In May, Chongqing Three Gorges Joint Stock Company, Hunan Zhongyu, acquired Zhonghan High Technologies, Hunan Tu Enterprise, hoping that its products would quickly occupy the market;

In June, Baota Mountain Paint in Shaanxi announced that it would purchase 13% of the ownership of Wuhan Baota Paint held by Cheng Jianxiang for 780,000 yuan in cash;

August Sto Group acquired 100% of Unitex Australia Limited through its subsidiaries. This acquisition of complementary resources and advantages of Sto Group and Unitex will have a huge synergistic effect in product, market, supply chain and manufacturing, and will pave the way for Sto Group to enter the Australian core market. With the change of environment in recent years, the domestic coatings industry lacks technological innovation and product homogeneity is becoming more and more serious. In addition, under the influence of external economic environment, small and medium-sized coatings enterprises have waged a "price war" in order to occupy a place in this economic crisis. In line with the advantage of "who is cheaper than my price", expand the territory. Although this method can achieve some enterprises, it can not last long. From the current development situation of domestic coatings industry, merger and reorganization is the only way for the coatings industry in the long run of future coatings market development. The future thinking should be not to seek more but to improve. Reflections on mergers and acquisitions of enterprises.