Jinshajiang GO Scale Capital led, Asia-Pacific Resources Development and Investment Co., Ltd. and Nanchang Industrial Holding Group Co., Ltd. and other Chinese and foreign consortiums under the support of the M&A fund, announced the successful acquisition of Royal Philips (Philips) recently (March 31) ) Lumileds has 80.1% of the shares, while Philips will retain the remaining 19.9%. The transaction, valued at approximately $3.3 billion, is expected to be approved by regulatory authorities in the relevant market in the third quarter of 2015, and will be completed after the transaction conditions are confirmed; the new Lumileds will include the original LED business and be spun off from the Philips Group. The car lighting division came out.
In response to the above acquisition, the market research institute TrendForce's Green Energy Division LEDinside research associate manager Yu Chao said that Philips Lumileds has the world's leading flip-chip process high-power LED technology. With the advent of the low-cost LED lighting market, most LED lighting manufacturers prefer medium and low power LEDs. Because the price advantage of medium and small power LEDs is far greater than the slow-growing high-power LED market, Lumileds is under pressure to reduce the market share of lighting.
On the other hand, the rise of China-based Asian LED manufacturers, coupled with YAG's white patents, will expire in 2017, and Lumileds faces more stringent cost challenges. Although actively looking for OEM production in Asia, it is difficult to change the fact that the market is fierce and the profit decline is also one of the reasons why Philips sold Lumileds. Chu Yuchao said that after the successful acquisition of Lumileds by Jinshajiang Group, the main impacts on the LED industry are as follows:
1. China's LED manufacturers have the opportunity to solve patent problems and cross overseas markets
Lumileds itself is one of the traditional five major LED patent manufacturers, and the Philips Group has transferred more than 600 patents to Lumileds's transaction, so Lumileds has a large number of LED patents. In the future, Lumileds may enhance the company's operational performance through patent licensing. It turns out that Chinese LED companies can't enter the market of patent blockade. Now that Chinese capital gains a controlling stake, they can gain the right to speak in global industry competition. This may also be a good opportunity for Chinese LED manufacturers to solve patent problems and enter overseas markets.
2. Jinshajiang Group may integrate its resources to increase Lumileds' strategic partners
Jinshajiang Group has invested in a series of related supply chains in the LED industry in the past, including crystal energy (E-crystal), Taishi core light (E-crystal), Yimei core light (package), Dalian three-dimensional (LED lighting and heat dissipation). LED companies such as Shangyu Lighting (LED Lighting). After the Jinshajiang Group holds the absolute dominance of Lumileds, it is possible to integrate its resources into the supply chain of Lumileds.
In the past, Lumileds focused on the production technology of high-power LEDs. Therefore, in the face of the rise of small and medium-sized power LEDs, the response strategies of these large European and American manufacturers are mostly submitted to the subcontractor to enhance cost competitiveness. LEDinside's judgment of future cooperation models does not rule out the expansion of China's strategic partners.
Analyst: Selling Lumileds boosts Philips market resilience
According to Lin Feihui, analyst and project manager of DIGITIMES Research, the acquisition will be able to invest resources in the future profitable and growth potential medical sector for Philips' parent company; new for Lumileds After investors enter the company, they will prioritize the adjustment of the company's physique, reduce liabilities, improve operations, etc., and enhance the flexibility of future capital market operations and the flexibility of strategic layout.
Lin Fenhui said that from the perspective of the Philips parent company, after the spin-off and sale of the shares, the subsidiary can focus on the medical business unit and brand management (its estimated medical product market value reached US$130 billion) and reduce profitability. Low LED components and manufacturing parts. In terms of financial performance in 2014, the company's medical division accounted for 42.9% of the total company's revenue, an increase of 1.9% compared with 2013, and EBITA (earnings before interest and tax amortization) accounted for 56.7% of the total; The lighting division (including LED components, lighting products, etc.) accounted for 32.1% of revenue, 4% less than in 2013, and EBITA's proportion was 31%, much smaller than the medical division.
Lumileds mainly produces high-power LED components, but due to the current market, the proportion of small and medium-power LED components is greatly increased. In addition, the capacity of small and medium-sized LEDs in Asia is uninterrupted and competitively priced, making Philips increase in the past two years. Taiwan factory and land factory purchases. In terms of MOCVD machine capacity, DIGITIMES Research estimates that China's global share will reach 34.7% in 2015 and Taiwan will be 25.5%. In contrast, Lumileds will account for less than 3%, indicating that the importance of Asian LED factories is increasing. high.
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