According to the fixed increase results disclosed on the evening of February 9, Anhui Conch Cement Company Limited(600585) was allocated 1 billion yuan, jumping to the third largest shareholder of the company; Tangshan Jidong Cement Co.Ltd(000401) its Hebei Jinyu Dingxin cement was allocated 500 million yuan, becoming the sixth largest shareholder; Gansu Shangfeng Cement Co.Ltd(000672) was allocated 300 million yuan and became the tenth largest shareholder.
Why do cement enterprises like to “buy peers”? Under the upsurge of M & A, is this financial investment or strategic layout? What impact will it have on the cement market?
“This shows the attitude of cooperation between the two sides and is also conducive to future market cooperation between the two sides.” In the view of insiders, M & A or mutual equity participation will not only optimize the industrial layout of cement enterprises and enhance market competitiveness, but also help the whole industry to deepen cooperation, jointly deal with risks and improve the stability of the market.
Anhui Conch Cement Company Limited(600585) do it again
Anhui Conch Cement Company Limited(600585) , known as the “God of stocks” in the cement industry, has “made a big deal” in the fixed increase of Xinjiang Tianshan Cement Co.Ltd(000877) . According to the announcement, Anhui Conch Cement Company Limited(600585) was allocated 7407474100 shares at a fixed increase price of 13.50 yuan / share, at a cost of about 1 billion yuan. After the registration of additional issuance is completed, Anhui Conch Cement Company Limited(600585) will hold Xinjiang Tianshan Cement Co.Ltd(000877) 0.86% equity and become the third largest shareholder of the company.
On February 10, Xinjiang Tianshan Cement Co.Ltd(000877) shares rose 2.52% to close at 15.45 yuan. Based on the fixed increase price of 13.50 yuan / share, Anhui Conch Cement Company Limited(600585) This investment has made a floating profit of 144 million yuan.
In the view of the industry, Anhui Conch Cement Company Limited(600585) participating in Xinjiang Tianshan Cement Co.Ltd(000877) fixed increase has the meaning of “strong alliance”. ” Xinjiang Tianshan Cement Co.Ltd(000877) as a large cement enterprise in China, it has a strong influence in the cement industry. The equity cooperation between the company and it is conducive to the continuous strengthening, excellence and expansion of the company’s main cement industry, as well as the healthy and orderly development of the cement industry.” For the participation in the fixed increase, Anhui Conch Cement Company Limited(600585) said in the announcement.
As two giants in the cement industry, Anhui Conch Cement Company Limited(600585) has the same strength as Xinjiang Tianshan Cement Co.Ltd(000877) . The new “cement brother” Xinjiang Tianshan Cement Co.Ltd(000877) has a clinker production capacity of about 300 million tons, a commercial concrete production capacity of about 400 million cubic meters and an aggregate production capacity of about 150 million tons. As of June 2021, Anhui Conch Cement Company Limited(600585) clinker production capacity is 264 million tons, cement production capacity is 372 million tons, aggregate production capacity is 58.3 million tons, and commercial concrete production capacity is 4.2 million cubic meters.
Whether participating in fixed growth, planning or raising cards, Anhui Conch Cement Company Limited(600585) has a “preference” for peers for a long time and has made a lot of profits. Taking Anhui Conch Cement Company Limited(600585) investment Tangshan Jidong Cement Co.Ltd(000401) as an example, in the 2011 semi annual report, Anhui Conch Cement Company Limited(600585) appeared on the list of Tangshan Jidong Cement Co.Ltd(000401) top ten shareholders for the first time, holding about 137 million shares. Since then, Anhui Conch Cement Company Limited(600585) has continued to “buy” on Tangshan Jidong Cement Co.Ltd(000401) : at the end of 2012, the shareholding increased to 207 million shares; At the end of 2013, it further increased to 216 million shares; At the end of 2014, the shareholding reached 267 million shares, ranking the second largest shareholder of Tangshan Jidong Cement Co.Ltd(000401) .
In 2015, Tangshan Jidong Cement Co.Ltd(000401) share price rose and Anhui Conch Cement Company Limited(600585) chose the opportunity to reduce its holdings; In 2017, Anhui Conch Cement Company Limited(600585) will sell all its holdings. According to the 2017 annual report, the company achieved an investment income of 1.86 billion yuan by reducing its holdings of Anhui Xinli Finance Co.Ltd(600318) , Xinjiang Qingsong Building Materials And Chemicals(Group)Co.Ltd(600425) , Tangshan Jidong Cement Co.Ltd(000401) .
In recent years, Anhui Conch Cement Company Limited(600585) is still moving. In December 2021, the company announced that it planned to spend 1.76 billion yuan to participate in the subscription of China West Construction Group Co.Ltd(002302) fixed increase. After the subscription of shares is completed, Anhui Conch Cement Company Limited(600585) will become the second largest shareholder of China West Construction Group Co.Ltd(002302) ; In October 2021, Anhui Conch Cement Company Limited(600585) raised Jilin Yatai (Group) Co.Ltd(600881) and became the second largest shareholder of Jilin Yatai (Group) Co.Ltd(600881) ; According to the third quarterly report of Gansu Shangfeng Cement Co.Ltd(000672) 2021, Anhui Conch Cement Company Limited(600585) holds 20265600 shares, ranking fifth among the top ten shareholders of the company for the first time.
As a cement giant with a total market value of more than 230 billion yuan, Anhui Conch Cement Company Limited(600585) has strong financial strength. According to the announcement, as of June 2021, Anhui Conch Cement Company Limited(600585) monetary capital was 57.438 billion yuan and net assets were 165.348 billion yuan.
“vertical and horizontal” or continuous
“Next, there will be more and more mergers and acquisitions of ‘big fish eat small fish’ among cement enterprises. In the future, the stronger the market will be.” The aforementioned insiders said.
Compared with other industries, why is the vertical and horizontal trend of the cement industry quite obvious? According to the analysis of cement big data Research Institute of China cement network, after the new implementation measures for capacity replacement of cement glass industry was issued in July 2021, the capacity expansion of cement enterprises was strictly constrained. Under the background of reducing excess capacity and capacity replacement, the increase of clinker capacity is strictly limited. If leading enterprises want to expand their scale and improve their industry control, they can only achieve it through mergers and acquisitions.
According to the Research Report of Tianfeng Securities Co.Ltd(601162) , the proportion of benchmark capacity of the cement industry is required to exceed 30% in 2025. In the future, the capacity of 2500 tons / day and below is expected to withdraw one after another, and the total capacity will shrink by more than 8.6%. The transformation of leading enterprises will further highlight the superposition of carbon reduction costs and increase the competitive pressure of small enterprises.
In fact, the upsurge of M & A in the cement industry in 2021 has been significantly accelerated. For example, by issuing shares to Bbmg Corporation(601992) , Tangshan Jidong Cement Co.Ltd(000401) purchased its 47.09% equity of Jinyu Tangshan Jidong Cement Co.Ltd(000401) joint venture at a price of 13.623 billion yuan, absorbed and merged the joint venture, and raised supporting funds at the same time. On January 13, 2022, Tangshan Jidong Cement Co.Ltd(000401) issued the announcement of additional issuance and listing, and the new shares were listed on January 14. The five-year strategic reorganization of Jinyu Tangshan Jidong Cement Co.Ltd(000401) came to a successful end.
“This is the only asset restructuring with a scale of more than 10 billion that was announced and completed in 2021 in China’s capital market.” Bbmg Corporation(601992) the Work Department of the board of directors said. Through this transaction, the cement assets of both parties have been integrated, and the business coverage of Bbmg Corporation(601992) in North China has been significantly improved.
In addition, Anhui Conch Cement Company Limited(600585) placards Jilin Yatai (Group) Co.Ltd(600881) , Gansu Shangfeng Cement Co.Ltd(000672) acquires Inner Mongolia Songta cement, Nanfang cement acquires Hangzhou Dama cement, Xinjiang Tianshan Cement Co.Ltd(000877) acquires Xinjiang Bohai Cement, Anhui Conch Cement Company Limited(600585) acquires 51% equity of Hongfeng cement, China Resources Cement acquires 51% equity of Liangtian cement, Tangshan Jidong Cement Co.Ltd(000401) successively acquires the equity of Daixian Hongwei cement and China Resources Fulong cement… The tide of M & A and reorganization of the cement industry continues one after another.
” Anhui Conch Cement Company Limited(600585) and other industry leaders have married with Xinjiang Tianshan Cement Co.Ltd(000877) to realize the combination of strength and strength, which has played a good industry demonstration effect. This can not only expand and strengthen the enterprise’s own cement business, but also help to optimize the competition pattern and improve the industry confidence under the background of profound reform and transformation of the cement industry. It is expected that the concentration of the cement industry will be further improved in 2022.” According to the analysis of China cement network cement big data research institute.
