"People used to ask each other, 'Have you made any money?' Now, everyone asks, 'Have you made any money?'" Recently held in the high-tech LED industry summit forum, an LED enterprise manager said wittily.

The forum held in Guangzhou attracted more than 20 LED enterprises to attend, and the main topic was to discuss the industry outlet in the period of change. Most entrepreneurs believe that after two years of rapid development, the LED industry is about to say goodbye to the dogfight, and mergers and acquisitions will be the best way out for enterprises in the fierce market competition.

According to the executives, the LED industry is in a wave of mergers and acquisitions, which is not only an opportunity for listed companies, but also for unlisted companies. Although the ownership of the enterprise is handed over, the shareholders of the acquiree acquire the listed shares of the acquiree through resale, which is equivalent to indirect listing of the enterprise. Moreover, in most cases of merger and acquisition, the original shareholders will not lose the management right.

Still, listed companies clearly have the edge in M&A activity. Lianjian Optoelectronic September 26 announcement, in the "stock + cash" way of merger and acquisition of Shenzhen easy Da electronic Co., LTD. The company, which specializes in LED displays and has previously planned an IPO, is no less profitable than its peers.

Zhang Xiaofei, president of Gaogong LED, believes that the M&A boom that started in March 2013 is further fermenting and that it is now in the best M&A period. No matter from the development track of the two parties, or from the support of the national policy, or from the current rising market environment, M&A seems to be the best way to avoid risks and gain competitive advantages in the industry reshuffle.

In the upstream of the industrial chain, LED chips benefit from the rapid development of the terminal LED lighting market, the first half of this year LED chips popular market is still continuing. Zhang Xiaofei believes that the number of enterprises with high power chip production capacity in China is rare, and domestic enterprises should focus on the high-end market when it comes to mergers and acquisitions. "In the future, it will be more obvious that the biggest companies will always be big."

In the middle reaches of the industrial chain, domestic LED packaging companies have little difference in technology, but the difference is their capacity scale. Some enterprises through mergers and acquisitions, integration of other small business resources, to achieve the purpose of capacity expansion. Gong Wen, general manager of Jingtai Shares, believes that the decisive factors in the competition of packaging companies in the future will be management ability, cost control and scale and brand.

In the downstream of the industrial chain, the overall LED lighting market improved in 2014, but due to the phenomenon of product homogeneity, the competition of lighting products is often limited to the price level. Some enterprises through the upstream integration, open up business alienation of competitive strategy. For example, Hong Kong-listed Zhenmingli recently completed its integration with Tongfang shares. In the opinion of Jiang Guangjun, deputy general manager of Zhenmingli's domestic center, "Judging from the development of the industry last year, LED lighting products will be out of the simple price competition and turn to product value competition." He explained that the smart building/home lighting solution launched by Zhenmingli this year is a move to adapt to the market development of smart cities.

Of course, M&A is not a panacea. Industry insiders believe that M&A is not only the integration of the capital market, but also the integration of corporate culture. If the two sides fail to reach a common goal, merger integration can have negative effects, such as the situation between BDO Runda and Lux Lighting.