M&A Analysis and Research Report on Catering Industry of P.R.C 2007

Abstract:

1. The background analysis over status quo and M&A in catering industry of P.R.C.

1.1 The analysis of catering industry

Catering industry as important part of light industry makes great contribution to rural area, interests of farmers and agriculture, earning from foreign trade, offering jobs and meeting the domestic needs. In 2006, the total value was RMB 0.24billion the sizable catering industry made sharing 8% and sales rate was 95% which hands in RMB 350 billion. There were 4.5million staffs working in this sector.

Position of food industry in China 's industrial output in 2006

In 2006, China's catering industry shaped very well by witnessing increasing spending power, new guidance coming in, industry upgrading and foreign venture moving in along with integration of domestic capital, which drives traditional catering industry shifting in accelerated phase from its low intensity state being. In addition, M&A and consolidation in this sector has been sweeping through. Sugar industry uplifting into the next stage, beverage industry being dynamic in nature, dairy industry in structure transformation, seasoning industry offering endless brand new products and confection market diversifying.

Import and export scale values USD 22.54billion reaching to USD 44.28billion in 2005 up 9.6%, which growing 18.4% in five years. In this context, import was slowing down with USD 20.08billion coming in, declining from 41.9% in 2004 to 0.1% in 2005 while export was moving up with surplus being USD 24.2billion growing 19.1% that is barging 11.4percentage in export over 7.7% in 2004 and surplus up to USD 4.12billion from USD 0.21billion in 2004. Export and import scale reached USD 5.billion.

Comparison of scale change of China 's food import and export from 2001 to 2006

1.2 The analysis of future catering industry

— the supply of meat industry moving up following more consuming in flesh beef and mutton while quality, hygiene and food security became the important factor in meat market.

— competition in dairy market growing fierce with transforming industrial model and revamping going on. The integration is merging based on capital and market in this sector. Brand advantage in industry will take M&A over medium and small size enterprises that held regional dairy resources. .

— beverage and drinking manufacturing industry is gaining momentum. Due to the state lowering 5 percentage in tax upon alcohol, to some extent, it will lift burden on alcohol manufacturers which helps increase profiting capability among big companies, transform industry into new business model and expand supply of alcohol. Beer industry will increase production in brands such as draft beer, free alcohol beer, brewing beer, dark beer and fruits and vegetable flavor beer. Canned beer sees eroded market. Ordinary beer market experienced ferocious competition with no big hit in profit per ton of drink.

— seasoning industry sees trend in series and upscale products. The quality management and brand image campaign are unprecedented in scale while packaging and publicizing tend to be professional and in more detail.

2. The motives of M&A in catering industry

In recent years, there have been three markets exited, among others, M&A and competition form foreign companies towards domestic ones. The second market is acquisition over domestic catering industry by foreign firms whose target is famous Chinese companies with big market share on the market while stock participation in foreign groups was adopted by China . Third, the take-over of domestic famous brands towards small and medium size companies, driving up consolidation within industry. However, the status quo in M&A is manifested in big company take over small one or brands among domestic a regional one.

1. Growing spending power and state policy laid the groundwork for catering industry. As per capita GDP moves to USD 1000, Engel coefficient will down and product mix is changing fast. The market is focusing on nutritional value, food diversity, convenience and security while market expanding 10% above with 20 to 30 years development. China is in the era when spending power barging. With food security beefed up, number of small companies not qualified will be knocked out of the market, which provides golden opportunity for scale expanding among laudable companies and industry consolidation.

2. The position taken by China 's manufacture as biggest one in world stage pushes smooth flow of industrial capital home and broad.

3. The unparalleled development of M&A in catering industry fostered by difference in uneven industry development and major buyer.

4. High percentage of small and medium size companies with little profit to be taken within same business model. With M&A and profession going on, big companies will absorb large chunk of profit while lead efforts on industrial integration. It is certain for China to take root in the world economy if the shape-up and domestic industrial value moving forward in WTO era.

M&A Cases in China's Catering Industry

3. The M&A trend in catering industry

The M&A in catering industry presents number of character as followed:

•  Industry consolidation merged in take-over storm. Verticle acquisition intends to grab the resources and network worldwide, and foster chain value cross-the-board while horizontal one deal with competition from globalization.

•  The driven power lies on strategic acquisition in catering industry. It intends to put all the available international market and marketing channel into use while allocate resources to expand market share and accessibility of China 's food processing and manufacturing industry. It helps circumvent trade barrier, expand foreign trade and create more value. It's expected that M&A scale in catering industry will be overwhelming and transaction of take-over valued above billions is not uncommon, especially in foreign acquisition, which is conductive to work of division, scale expanding of leading companies and chain build-up. At the time, the change in food consuming structure, habits and power will boost industrial upgrading and profit model. In all, acquisition stirs up individualized products, line of division, expanding leading company and industrial chain.

Content: 


Chapter 1 Research Overview
Section 1   Background of the research
Section 2   Contents of the research
Section 3   Method over the research
Section 4   Team for the research
Section 5   Conclusion for research

Chapter 2 The status quo of catering industry on world stage 
Section 1   The development pattern of catering industry worldwide
Section 2   The market status quo of pharmaceutical industry worldwide
1. The analysis of market scale worldwide
2. The trend of market demand in catering industry worldwide 
Section 3 the competition in catering industry worldwide
Section 4 the status quo of industrial development in American catering industry
Section 5 the status quo of industrial development in Japanese catering industry

Chapter 3 The status quo of catering industry in China
Section 1 the character traits of catering industry in China
Section 2 the development trend in catering industry between 2007 and 2010
Section 3 the supply and demand in catering industry between 2006 and 2007
1.  The over all supply 
1.1 Investment scale in catering industry 
1.2 Production intensity of catering industry in China
2.  The over all demand 
2.1 Demand character in China’s catering industry
2.2 Demand structure in China’s catering industry

Chapter 4 The market analysis of catering industry in detail
Section 1 The fast food market
Section 2 The canned food market
Section 3 The beverage market
Section 4 The confection market
Section 5 The cookies market 

Chapter 5 Investment policy environment in China’s catering industry
Section 1 The impact of macro-economy towards catering industry 
Section 2 The industrial and relevant policy upon catering industry

Chapter 6 The Impact factoring Catering Industry
Section 1 Risk in catering industry
1.  Food security 
2.  Price of raw material
3.  Dietary habit 
Section 2   Development of current catering industry

Chapter 7 The Status of Regional Catering Industry and M&A Trend 
Section 1 Northeast 
1. Demand to regional catering industry between 2007 and 2010
2. The development character and industrial pattern to regional catering industry
3. Regional competition and major player in regional catering industry
4. M&A trend and feasibility in regional catering industry
Section 2 Northern region
1. Demand to regional catering industry between 2007 and 2010
2. The development character and industrial pattern to regional catering industry
3. Regional competition and major player in regional catering industry
4. M&A trend and feasibility in regional catering industry
Section 3 Central China
1. Demand to regional catering industry between 2007 and 2010
2. The development character and industrial pattern to regional catering industry
3. Regional competition and major player in regional catering industry
4. M&A trend and feasibility in regional catering industry
Section 4 Southern China 
1. Demand to regional catering industry between 2007 and 2010
2. The development character and industrial pattern to regional catering industry
3. Regional competition and major player in regional catering industry
4. M&A trend and feasibility in regional catering industry
Section 5 Southwest 
1. Demand to regional catering industry between 2007 and 2010
2. The development character and industrial pattern to regional catering industry
3. Regional competition and major player in regional catering industry
4. M&A trend and feasibility in regional catering industry
Section 6  Northwest 
1. Demand to regional catering industry between 2007 and 2010
2. The development character and industrial pattern to regional catering industry
3. Regional competition and major player in regional catering industry
4. M&A trend and feasibility in regional catering industry
Section 7  Eastern region 
1. Demand to regional catering industry between 2007 and 2010
2. The development character and industrial pattern to regional catering industry
3. Regional competition and major player in regional catering industry
4. M&A trend and feasibility in regional catering industry

Chapter 8  The Status Quo of M&A in Catering Industry of P.R.C.
Section 1  The background of M&A in China
Section 2  The status of M&A 
Section 3  The M&A trend of catering industry in China
Section 4  Case study in catering industry

Chapter 9  The Block to M&A of Catering Industry in China
Section 1  Capital 
Section 2  Technology
Section 3  Management

Chapter 10  M&A Case Study in Foreign Country
Section 1  Unilever purchasing 
1. Motives and value of M&A
2. Procedure of M&A
3. Solution and lesson of M&A
4. Strategic decision in M&A
Section 2  Pepsi-Cola purchasing Quaker Oats
1. Motives and value of M&A
2. Procedure of M&A
3. Solution and lesson of M&A
4. Strategic decision in M&A
Section 3  Pepsi-Cola purchasing Tropicana
1. Motives and value of M&A
2. Procedure of M&A
3. Solution and lesson of M&A
4. Strategic decision in M&A
Section 4 America Food purchasing Lanes Food
1. Motives and value of M&A
2. Procedure of M&A
3. Solution and lesson of M&A
4. Strategic decision in M&A
Section 5 Consolidation between Pillsbury & GeneralMills
1. Motives and value of M&A
2. Procedure of M&A
3. Solution and lesson of M&A
4. Strategic decision in M&A
Section 6  KKD purchasing MMX
1. Motives and value of M&A
2. Procedure of M&A
3. Solution and lesson of M&A
4. Strategic decision in M&A

Chapter 11  M&A Trend of Foreign Catering Industry Upon China’s Counterparts
Section 1  The development of foreign catering industry in China
1. Investment
2. Targeted area for investment
3. Market performance
4. Investment products mix 
5. Investment trend
Section 2  Nestle
1. Investment in China	
2. Core competition
3. M&A trend and feasibility
Section 3  Unilever Group
1. Investment in China	
2. Core competition
3. M&A trend and feasibility
Section 4  Pepsi-Cola
1. Investment in China		
2. Core competition
3. M&A trend and feasibility
Section 5  Coca-Cola
1. Investment in China	
2. Core competition
3. M&A trend and feasibility
Section 6  ConAgra 
1. Investment in China	
2. Core competition
3. M&A trend and feasibility
Section 7  Danone
1. Investment in China		
2. Core competition
3. M&A trend and feasibility

Chapter 12  Foreign Company Waiting for Coming in
Section 1  Mars
1. Business performance
2. Core competition
3. Background and motive for foreign company entering into China
4. Trend and possibility of foreign company investing in China
Section 2  Saralee
1. Business performance
2. Core competition
3. Background and motive for foreign company entering into China
4. Trend and possibility of foreign company investing in China
Section 3  Snow Brand Milk Products Co., Ltd.,
1. Business performance
2. Core competition
3. Background and motive for foreign company entering into China
4. Trend and possibility of foreign company investing in China

Chapter 13  Case Study of M&A in Domestic Catering Industry
Section 1 Beijing Sanyuan purchasing Kraft 
1. Motive and value of M&A 
2. Procedure of M&A
3. Solution and lesson of M&A
4. Strategic decision of M&A
Section 2 Shanghai First Provisions Store purchasing Shanghai Tea
1. Motive and value of M&A 
2. Procedure of M&A
3. Solution and lesson of M&A
4. Strategic decision of M&A
Section 3 Shanghai First Provisions Store purchasing Nampa Food
1. Motive and value of M&A 
2. Procedure of M&A
3. Solution and lesson of M&A
4. Strategic decision of M&A

Chapter 14 Major Player of M&A in China’s Catering Industry
Section 1 Minnie
1. Products mix 
2. Capital operation 
3. Competitiveness
4. Marketing network
5. Strategic development 
6. M&A trend and feasibility 
Section 2 Yale 
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility
Section 3 Bright dairy
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility
Section 4  Wahaha
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility
Section 5  Wuliangye Group
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility
Section 6  Guangdong Strong Group Co.,Ltd
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility
Section 7  Dalian Hualong Foodstuffs Co., Ltd
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility
Section 8  Tsingtao Brewery Group
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility
Section 9  Kweichou Moutai Co., Ltd 
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility
Section 10  COFCO Le Conte Food (Shenzhen) Co., Ltd.
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility
Section 11  Goubuli
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility
Section 12  Laoganma
1. Products mix
2. Capital operation
3. Competitiveness	
4. Marketing network
5. Strategic development
6. M&A trend and feasibility

Chapter 15  Industry Chain & M&A in China’s Catering Market
Section 1 Catering industrial chain
Section 2  M&A between catering industry and up-stream company
Section 2  M&A between catering industry and down-stream company

Chapter 16 Possibility of scale M&A in China’s Catering Industry
Section 1 Possible M&A in scale Food Company
1. Mengniu
1.1 Strategic development 
1.2 Bottleneck of strategic development
1.3 Possibility of M&A
2. Yili
2.1 Strategic development
2.2 Bottleneck of strategic development
2.3 Possibility of M&A
3. Brightdairy
3.1 Strategic development
3.2 Bottleneck of strategic develoment
3.3 Possibility of M&A
4. Tsingtao Brewery Group
4.1 Strategic development
4.2 Bottleneck of strategic development
4.3 Possibility of M&A
5. Kweichou Moutai Co., Ltd 
5.1 Strategic development
5.2 Bottleneck of strategic development
5.3 Possibility of M&A
Section 2 Possibility of M&A in medium and small food companies
1. COFCO Le Conte Food (Shenzhen) Co., Ltd.
1.1 Feasibility of M&A
1.2 Value of M&A 
2. Goubuli 
2.1 Feasibility of M&A
2.2 Value of M&A
3. Laoganma
3.1 Feasibility of M&A
3.2 Value of M&A
4. Guangdong Strong Group Co.,Ltd
4.1 Feasibility of M&A

Chapter 17  Risks of M&A in China’s Catering Industry 
Section 1  State food policy
Section 2  Asset Restructuring
Section 3  Food security
Section 4  Entrepreneurial culture
Section 5  Corporate strategy 

Chapter 18 Recommendation of M&A in China’s Catering Industry 

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