On May 25th, the Shandong Provincial Government agreed in principle to form Shandong Heavy Industry Group (hereinafter referred to as “Heavy Industries Groupâ€) through three announcements issued by three listed companies in Shandong Province, Weichai Power, Weichai Heavy Machinery and Shantui. Machinery and component manufacturing companies Shandong Engineering Machinery Group (hereinafter referred to as "Shangong Group"), Shandong Automotive Industry Group (hereinafter referred to as "Shanqi Group") and Weichai Holdings have integrated.
Shangong Group holds 21.1% stake in Shantui, which is the main production base for construction machinery in China. Weichai Holdings holds a 14.92% stake in Weichai Power and holds a 30.59% stake in Weichai Heavy Machinery. It is the largest auto parts manufacturer in China. The SAIC Group, incorporated and incorporated in 2004, is a wholly state-owned enterprise with an annual production capacity of 60,000 light trucks and 1 billion yuan in auto parts.
Previously, Sinotruk, heavy truck production company in Shandong Province, China Heavy Duty Truck Co., Ltd. has frequently appeared in the integration of Shantui shares, but eventually, Sinotruk failed to participate in the reorganization. According to sources, the Heavy Industry Group will become the first automobile company with an income of over 100 billion yuan in Shandong Province, and China National Heavy Duty Truck Group will be built into the second automobile group in Shandong Province with revenue exceeding 100 billion yuan.
China National Heavy Duty Truck will become the second 100 billion auto group
According to the Shandong Provincial Automobile Industry Adjustment and Revitalization Plan, the province’s large-scale auto companies have reached more than 800, and in 2008 they achieved sales of 230.9 billion yuan, ranking second in the country after Guangdong, and ranking first in auto parts exports in China.
Although the total economic output of the automobile industry in the province has grown rapidly, there are some structural contradictions. There is a large enterprise group that has a production volume of over one million cars and whose main business income exceeds one hundred billion yuan. Auto parts companies are small in scale and low in professionalism.
On this basis, on April 21st this year, Shandong Province issued the “Regulations on Revitalization of the Automotive Industry in Shandong Provinceâ€, stating that it is necessary to cultivate 8-10 large-scale enterprise groups with strong competitiveness, of which the operating income exceeds 100 billion yuan. Two. With large enterprise groups as the core, a group of automobile industrial parks that integrate advanced parts and components supporting enterprises will be formed.
After the plan was released, the first object of integration was targeted at Weichai Holdings, the largest component manufacturing company in the province.
The people from Weichai Heavy Machinery and Shantui Stocks Securities unanimously stated that at present there is no other progress other than this just-arrived notice.
After the news was released, personnel from the Enterprise Reform Office of the State-owned Assets Supervision and Administration Commission of Shandong Province stated that the main leaders are on business trips and cannot answer questions from reporters.
On May 25th, Li Chunbo, an analyst at CITIC Securities, told reporters: “Since Shandong Province announced the adjustment plan for the automobile industry, the industry has long had reorganization rumors about Weichai Power, Shanqi Group and Shangong Group. Although there is no specific integration plan, Future reorganization should begin around the stronger Weichai Holdings.â€
Li Chunbo said, “From a group perspective, Weichai Holdings has a strong presence and future integration will definitely take Weichai Holdings as the main entity. Specifically, Weichai Holdings may have the right to speak in terms of decision-making. There will be a big difference."
Some analysts believe that according to the previous plan of Shandong Province, the group will become the largest auto parts production group in Shandong Province with Weichai Holding as the core.
Li Chunbo believes that the group's Shandong Heavy Industry Group will be built to be the first automobile group in Shandong Province to receive revenues of over 100 billion yuan, thus completing half of the province’s goal of nurturing two billion-dollar enterprises.
China Heavy Truck, a large heavy-duty heavy-duty company in Shandong Province, which had previously had enough rumors, did not enter the scope of this restructuring. In response, sources said that in fact, everyone in the industry knows well that China National Heavy Duty Truck will become the core member of the second 100 billion-level auto company built in Shandong Province.
In response to this statement, China National Heavy Duty Truck Executive Secretary Liu Bo said in an interview with reporters that he first heard that the company did not get any relevant information from the government department.
Sources believe that from the current point of view, taking Weichai Holdings and China National Heavy Duty Truck as the center, creating a duopoly auto group will become the pattern of the future Shandong auto industry. Weichai Holdings, as the country's largest auto parts manufacturer, and China National Heavy Duty Truck Group, as the major domestic heavy-duty truck production base, will become the respective advantages of the two major automobile groups in Shandong Province.
Listed companies show that after consolidation, their impact on the business is small
Li Chunbo believes that the current problem may be focused on whether the group integration will also be carried out at the level of listed companies, and whether the three listed companies will further absorb mergers in the future. Although there is no clear indication of the direction of future integration, the possibility of consolidation at the level of listed companies is not excluded.
Stimulated by the news of integration, the stock prices of the three listed companies rose against the market on that day, Weichai Power gained 1.3%, Shantui shares gained 4.74%, and Weichai Heavy Machinery finally closed at a daily limit.
In this regard, Mr. Yang, a person in charge of Weichai's heavy machinery securities department, told reporters that he did not rule out the possibility of the market borrowing news to announce the possibility of the stock price rising. However, he believes that it should be more optimistic about the factors such as the company's completion of restructuring, getting rid of losses and other fundamental changes.
However, the effect of restructuring the business after restructuring does not seem obvious.
Ms. Yuan of the Shantui Stocks and Securities Department stated that Shantui had not had much business dealings with Weichai Holdings in terms of spare parts procurement. Weichai Holdings’ products are mainly used for the manufacture of heavy-duty trucks and heavy trucks. Therefore, Ms. Yuan believes that after the integration, the company's business will not be much affected.
Mr. Yang from Weichai Heavy Machinery Securities also stated that the integration will not cause too much impact on the company's business.
"There is no concrete plan at the moment. It is entirely the government that is leading, and when the plan is announced, we have not got the latest news." This is almost the reporter's unified reply from Shantui Stock and Weichai Heavy Machinery.