Source: Marking Machine Network http://www.technifor.cn/
Report by Cheng Jiulong - Less than half a month after the reorganization of Wuhan's two major laser companies, Shenzhen-based competitor Han's Laser wields the capital stick again and advances to the city. Yesterday, Han's Laser (002008) announced that the company will acquire equity stakes and increase capital investment in Wuhan Jinshi Kai Laser Technology Co., Ltd. (hereinafter referred to as "Wuhan Jinshi Kai"), thereby becoming its controlling shareholder.
Yesterday afternoon, this reporter called Han's Laser Secretary Hu Dianjun as an investor, who said: "This is a strategic investment for Han's Laser. We hope to enter the laser heat treatment field through the acquisition of Jinshi Kai, improving Han's Laser industrial chain."
Han's Laser Reinforces Wuhan
"Negotiations took only two months, Han's Laser was very efficient," Chen Qingming, chairman of Wuhan Jinshi Kai, told reporters: "Han's Laser highly recognizes Jinshi Kai's strength in the high-power laser field, and Han's Laser has a strong desire to enter this business."
It is understood that in the domestic marking machine and other mid-to-low-end laser equipment fields, as a latecomer, Han's Laser has been dominant in this market. In recent years, Han's Laser has increased its R&D efforts in high-power high-end laser products.
The announcement shows that Han's Laser dominates traditional laser industrial equipment in six areas: laser marking, cutting, welding, heat treatment, micro-processing, and drilling. The laser heat treatment field is the only laser industrial processing equipment field that Han's Laser hasn't yet entered. It is known that laser heat treatment equipment has relatively high profits, and through the investment in Wuhan Jinshi Kai, Han's Laser has basically completed its product strategy layout in the laser industrial processing equipment field.
This acquisition will be completed in two steps. First, Han's Laser will acquire 25% of the shares held by Yu Jiang and three other shareholders for RMB 12.5 million. Then, it will increase its capital investment in Wuhan Jinshi Kai by RMB 30 million, expanding its registered capital to RMB 80 million. Together with the equity transfer, Han's Laser will own RMB 42.5 million of Wuhan Jinshi Kai's registered capital, accounting for 53.125% of the total shares, thereby achieving absolute control.
Jinshi Kai Awaits "Rebirth"
Facing the soon-to-be "changed ownership" enterprise, Chen Qingming prefers to see this as a cooperation between strong parties. Wuhan Jinshi Kai is the supplier of China's first commercialized ten-kilowatt level transverse flow CO2 laser, which is precisely the key equipment for laser heat treatment.
"Producing such high-power lasers requires both a large investment scale and high technical barriers. Therefore, few general laser companies venture into this area," an executive from a laser company in Guanggu told reporters yesterday: "The profit margin in this field is high, and Jinshi Kai is quite large in scale within the industry."
However, what contrasts sharply with this is that the announcement shows that Wuhan Jinshi Kai Laser achieved sales revenue of RMB 4.6838 million in 2006, with losses reaching RMB 7.1198 million. It wasn't until this year that they turned a profit, with net profit in the first ten months amounting to only RMB 570,800.
"We have leading products and core technologies, but the company's operations are not ideal," Chen Qingming expressed his concerns about this situation. In his view: "Mainly in terms of product marketing and corporate management, there is still room for improvement."
The entry of Han's Laser could bring improvements in these two aspects for Jinshi Kai. Chen Qingming told reporters that Han's Laser would send people to join the company's management team, and Jinshi Kai might also benefit from Han's Laser's marketing network. However, regarding specific restructuring details, both parties refused to disclose further information.