Chinese furniture companies have risen to the “sea tide”, why is soft furniture the most prominent?

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In recent years, many A Shares/Hong Kong stocks home-listed companies have announced relevant overseas investment. Gujia Home, Dream Lily, Meike Home, Xilinmen, Qumei Home, and Minhua Holdings have all issued announcements. It seems that the overseas production capacity of finished products has been It is the trend of the times.

In recent years, Chinese companies have accelerated their overseas investment, and Chinese furniture companies have frequently gone to sea.

For Chinese furniture companies, the choice of going out, Cinda Securities previously commented on Gujiajiao said, “The market development of local brand enterprises will generally have three stages: from regional to national to global development of. Enterprises that can achieve globalization will have better performance in terms of development speed, cycle resistance and industry competitiveness.

“The time is ripe for the sea

Market uncertainty is intensifying Chinese furniture companies have accelerated to the sea.

The Tianfeng Securities Research Report analyzed that the export value and import value in November increased by 5.4% and 3.0% respectively (down from 10.1 and 17.8 points), which was lower than market expectations.

However, the export flexibility of furniture is strong. The export value of furniture and its parts increased by 8.1% from January to November (from 7.0% in January-October). The report judged that it was affected by previous trade disputes and overseas customers chose Orders in advance, this move will promote the faster growth of home furnishing exports in the third and fourth quarters, but will cause overdrafts in 2019 orders.

It is worth noting that the current A-share home-listed companies, including Gujia Home, Meike Home, and overseas markets have all formed scales.

According to the statistics of Guotai Junan, among the A-share home-listed companies, the dealer channels including Ou Pai Home and Qumei Home accounted for the highest proportion, which were 84.08% and 81.39% respectively.

The lowest proportion is Meike Home, the distributor channel is only 7.04%, and the dealer channel of Gujia Home is only 46.60%.

However, in overseas markets, the ODM of Gujia Home has reached 34.34%, and the wholesale of Meike Home has also accounted for 18.31%.

In addition, furniture brands that previously focused on the domestic market have gradually increased their willingness to invest overseas in order to further expand their market size.

Accelerating overseas production capacity

As of now, many A Shares/Hong Kong stocks listed companies have announced relevant overseas investment. According to Tianfeng Securities, since 2018, at least four A-share and H-share furniture listed companies have carried out overseas production capacity. If you calculate the overall investment, the number is even more.

Gujia Home:

On March 26, 2018, it signed an Equity Transfer Agreement with Australian Nick Scali to acquire a 13.36% stake in the latter for A$77.763 million. The equity settlement process was completed in Australia on April 27.

On March 22, 2018, the company signed a “Shares Sale and Subscription Agreement” with Natuzzi, Italy, and acquired a 51% stake in the Shanghai joint venture for EUR 65.50 million, and obtained the exclusive distribution license granted by the latter.

On February 28, 2018, the company signed an “Equity Transfer Agreement” with Rolf Benz of Germany, which obtained 99.92% of the latter’s shares for 4156.50 million euros. The delivery procedure was completed in May.

In addition, on October 14, 2018, the company signed a letter of intent for equity transfer with Huayi Investment, the controlling shareholder of Xilinmen. It plans to acquire Xilin Investment held by Huayi Investment at a price of not less than 1.38 billion yuan. A total of not less than 23% of the shares.

If the acquisition is completed successfully, Xilinmen will become the holding subsidiary of the company. Considering that Xilinmen is one of the leading enterprises in domestic soft beds and mattresses, it can further enrich the brand layout and product sequence of the family bed series. Consolidate the company’s leading position in the industry.

Dream Lily:

On November 30, 2018, the company announced a non-public offering plan, and the total amount of funds raised is not more than 800 million yuan. Among them, 350 million yuan will be used for US production base construction projects, 250 million yuan for Serbia (third phase) production base construction projects, and the remaining 200 million yuan will be used to supplement working capital.

According to Tianfeng Securities Report, after the acquisition of Hengkang Serbia in 2013, Mengli has continued to expand its overseas production capacity. Currently, it has established factories in Spain, Serbia, Thailand and the United States.

In addition, the company acquired Spanish Dream at the end of October 2017 to open its own brand market in Europe with its European sales channels.

Meike Home:

On November 24, 2018, the company issued an announcement to increase the capital of three Vietnamese subsidiaries, with a total capital increase of US$26 million.

The announcement stated that the capital increase of the above three target companies is conducive to the overall optimization of production capacity, further transforming Southeast Asia into a major supply source for the company’s North American market and improving the global allocation of the company’s supply chain.

Xilinmen:

On September 5, 2018, the company announced that it intends to invest 9.9 million US dollars to establish a wholly-owned subsidiary in Hong Kong, which will jointly invest with Zhejiang Ruixi Investment Management Co., Ltd. and Zhejiang Xilinmen Software Furniture Co., Ltd., a wholly-owned subsidiary of the company. Established a subsidiary in Thailand.

Qumei Home:

According to the company announcement, as of August 29, Qumei Home has completed the tender offer for Ekornes ASA and holds Ekornes ASA through its overseas subsidiaries. 98.36% of the shares, the remaining shares are compulsory acquisitions under Norwegian law. In addition, Ekornes ASA’s performance began in September and is a beautiful home.

Qumei Home previously announced that the company would provide 3.677 billion yuan in cash for this transaction.



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