Entering the 2013, China's Internet entered the merger season

Absrtact: Into 2013, China's Internet into the merger season, Ali shares Sina Weibo and gold, the acquisition of PPS video business and Archie Integration, the acquisition of the Seventh Avenue remaining equity, Herts Strategic Investment in China's Internet industry competition pattern experienced

Into the 2013, the Chinese Internet into the "Mergers and acquisitions season", Ali shares Sina Weibo and Gould, Baidu acquisition of PPS video business and Archie Arts integration, the acquisition of the Seventh Avenue of residual Equity, Herts Strategic Investment in Shenzhou rental car ... The competition pattern of China's internet industry has undergone great changes, in fact, change is to happen sooner or later, capital and mergers and acquisitions accelerate the arrival of the time of upheaval.

From the perspective of mergers and acquisitions, the internet giants have large sums of cash, but also want to use capital means to diversify the layout, to make up for the lack of business innovation. Because users and channels by several internet giants monopoly, entrepreneurial team's project once the giant stare, small repairs to copy a similar product, often a fatal blow to the entrepreneurial team, but "plagiarism" the wind of the matter itself, side reflects the giants of the lack of innovative ability. For those who do not succeed in the case, the Giants sitting on large sums of cash, the use of capital means can also achieve the goal of strategic layout.

As of 2013 Q1, Baidu held cash, cash equivalents and a short investment of about 5.445 billion dollars;

Tencent held cash and cash equivalents by the end of 2012 and counted more than 27.2 billion yuan in fixed deposits.

June 2012, Alibaba Group billion 2.5 billion U.S. dollars in cash to complete the privatization of listed companies alibababa.com, the same year in September, Ali Group announced the completion of 7.6 billion U.S. dollars to buy back the 20% shares held by Yahoo, and said the transaction completed, the group's cash reserves of $3 billion;

NetEase Company by the end of 2012 cash and short cast total 2.4 billion U.S. dollars;

Q1 held cash and a short investment of more than 850 million dollars as of 2013.

What are the common features of the mergers and acquisitions?

Big internet companies favor investment projects focused on the electric business, tourism, social, video and other fields. Companies that have been merged or invested have more or less common features:

First, they are in the industry in the high-speed growth stage, with a huge potential user base, the development of space is huge, and these companies in the industry chain has a bit, have a certain user base, but continue to grow and develop needs more support. Mobile portal, social, tourism, electric and O2O, are the most recent years of internet entrepreneurship and investment in the hot field, nature is also particularly favored by the internet giants. For example, Baidu invested where to go; Ali invested in Sina Weibo, Gold, American Regiment, Mo and so on, Tencent has invested in Xun, high friends, good buy, Kelan diamonds, Beautiful said ...

Second, the industry competition pattern has not been determined, need to alliances, after the merger market share can be superimposed to determine or change the industry pattern. For example, Youku and potatoes, Archie Art combined with PPS, Sohu Video and pplive rumors. The recent rumors of Qihoo and Baidu to bid for Sogou is the industry Forces nouvelles 360 to change the industry pattern, and Baidu for defensive considerations also to Sogou throw Olive branch, thus forming the eldest brother and second bid old situation.

Third, the business development encountered specific bottlenecks, want to find a "capable" of the main support business. For example, Sina Weibo Alibaba shares, the important reason is the micro-bo monetization of resistance, hope that with the help of the micro-BO Alibaba to provide assistance; For example, the High German software to pull a stake, the company is not short of money, in recent years, from the car navigation business-to-business to the Internet, the gold has map data, but lack of internet Hope that Ali shares will strengthen data cooperation.

Five, the correlation is not strong diversification of the company inside a strong independence of a business, looking for additional synergies. For example, Sohu sells Sogou to Qihoo.

Who could it be next?

Video: PPLive, Thunder

After the excellent cool potatoes, Archie pps, as well as the acquisition of 56 nets, video industry concentration continuously improve the industry pattern is also increasingly clear, in this "fight Dad" industry, funds and business capacity of the site will be further shuffle. And the rest, on the number of Sohu video, Tencent video, Thunder Look, pplive, music, such as a few sites do relatively good, considering Sohu video, Tencent Video has a strong management background, may further promote the industry integration, forming a "number of head" pattern.

In addition, two years ago, Thunderbolt publicly submitted the IPO prospectus disclosed that Sohu has agreed to the Thunder IPO to buy 10 million U.S. dollars thunder of a class common stock, this episode behind the story of both sides have not openly told, but the side reflects Sohu for the Thunder Company and business recognition, as well as "cooperation" positive attitude, Will there be further cooperation in the future?

Video client before two big players pplive and Pps,pps were bought by Baidu, PPLive 250 million dollars in soft silver in 2011 for the IPO, but the IPO is not on the agenda, the profitability is not strong, if the video industry to increase competition, pplive in the absence of IPOs may also need to consider other capital methods.

Electric Dealer: When

Last year, Taobao + day cat turnover exceeded 1 trillion, is a milestone in the E-commerce sector, Ali's electric business ecological strategy not only affect consumers, but also led to the surrounding industry, the largest capital of the east, the use of large-scale expansion and "low-cost" strategy to crowd out competitors, solid self-consumer supremacy, on the contrary, Dangdang's situation is increasingly embarrassing; the only thing that will be smart is to steer clear of the most competitive combination of business, cultivate a group of loyal brand discount merchandise Flash consumer group, with the size of the division in the larger advantage, only the goods will be valued all the way up, currently more than 1.8 billion U.S. dollars; Public comments Group, such as several service-quality sites are increasingly prominent position. Next, the electronic commerce domain shuffle also will continue, the comprehensive class big platform's scale effect will slowly present, the small website survival space is getting smaller.

In the awkward industry situation, Dangdang market value only the current 420 million U.S. dollars, to rise again to challenge Jingdong, when it must have a strong financial strength, and the hands of only 260 million dollars in cash, it has to continue to implement a contraction strategy to gradually reduce losses and maintain survival; Dangdang's experience in supply chain accumulated over the years in the field of electrical business , user size, brand, etc. are valuable, but also the industry leader to continue to expand the need for a certain value of mergers and acquisitions. But the current estimate of acquisitions as the biggest drag comes from its founders.

Online Tours: Hornet's nest, cool News

Baidu acquisition to where, Tencent shares with the network and art Dragon, online tourism industry's largest mergers and acquisitions have occurred, the industry pattern has been basically clear. The next area of mergers and acquisitions, most likely to occur in the subdivision area, especially Ctrip is currently promoting the tourism industry chain layout, the acquisition of the railway ticketing website Tieyu, catering Web site, such as the small secretary of the site, the beginning of this year also increased capital vacation apartments passers-by. In the future, the vertical areas do better, including the tourist community Hornet's nest, search media cool news, etc., may be ctrip and other online tourism big strategic layout of the investment target.

Online games

Large-scale client market development has met the ceiling, page tour, hand tour is the current online market growth of the field, and the overall market share of the game is rising. But because of the short game cycle, low development threshold, easy to be copied and other issues, valuations tend to be relatively low, including the unlisted social game developers Zynga valuation since the listing also fell, the current market capitalisation slipped to 2.3 billion of dollars. But the growth prospects and undervaluation of the sector, which is just as likely to be considered by the Giants, have already signed an agreement this month to buy the rest of Seventh Avenue, showing a bullish view of the market. Giant Network, the perfect World, netease and other traditional end-travel companies, cash is also very much, the future does not exclude the consideration of page tour, hand travel in the field of mergers and acquisitions opportunities.

Information Classification Service website

58 with the city, the market is the current Chinese information classification and local life services markets duopoly, with a certain size of the user and brand awareness, but the cash flow may not be good, if the future can not IPO or further financing, so that larger giants to buy or consolidate is also possible.

Comment Class website

The public comments are estimated to be bat are very want to have, but now to see the public comment on the probability of the IPO may be higher.

No matter who is the next takeover of China's internet industry, but the industry into the merger season, but also marks the Chinese Internet has entered a new stage.