Fashion Industry Is Now Merging With Many Brand Dreams.

　　 clothing After the industry entered the trough, the merger and acquisition of enterprises unexpectedly became more positive. Shortly after Semir's acquisition of the clothing brand GXG, there was news of the takeover of the high-end men's clothing business. In addition, according to the Beijing Commercial Daily reporter, recently, many domestic clothing brands regard overseas brands as the target of mergers and acquisitions. For a time, the tide of vigorous fashion brand mergers and acquisitions is spreading. However, under the reality of high inventory, high cost and low profit, the multi brand strategy of garment enterprises may increase the capital burden and not be valued by the outside world.

　　 Mergers and acquisitions in garment industry

Leisure in mid June Clothes & Accessories Semir has hit the biggest merger case in the clothing industry at a high price. Its announcement said it would buy a 71% stake in Ningbo zhe Mu sang holdings limited by 1 billion 980 million -22.6 billion yuan. According to introduction, zhe Mu Shang is a self owned clothing Brand Company, which is mainly located in high-end casual menswear. Its brands include GXG, gxg.jeans and so on.

A month later, the news of the acquisition of high-end men's clothing was also released by the king of nine herdmen. Wu Huirong, the company's secretaries, also confirmed this. He also stressed that from the industry perspective, the integration of clothing brands is a long-term trend. "We also have more cash flows, and we hope to take more brand development strategies after raising funds, but such opportunities can not be met." Wu Huirong said.

Not only are these two industry giants fond of mergers and acquisitions, many garment companies are eager to buy. According to the Beijing Commercial Daily reporter, the domestic garment enterprises have strong desire to acquire Korea Companies. It is understood that the Shandong Weihai Di Group has been holding shares in the way of holding South Korea's three largest clothing companies listed on the AVISTA company's 38.96% stake, becoming the largest shareholder.

　 Multi brand dream of clothing enterprises

Some analysts believe that although the clothing brands are currently facing serious problems such as high inventories and declining profits, they also create a good time to hunt for the bottom. Especially those big brands, in the face of the temptation to "eat small fish with cheap big fish", will not let go.

Take overseas mergers and acquisitions as an example, the reason why it is more common to buy and buy Korean clothing enterprises is not only the obvious trend, but also the low purchasing cost. It is understood that the Korean garment enterprises affected by the economic downturn, sales and profits fell sharply, many of the shares of enterprises also fell to the "cabbage price", taking over the cost is relatively low.

In addition, for large brands, the bottom line is not the ultimate goal. From the direction of mergers and acquisitions of Semir and King Mu, we can see that they are interested in high-end transformation, so as to realize the diversification of business brand. For this wave of mergers and acquisitions, Zhu Qinghua, a light industry researcher at CIC, said that if the clothing market is not at a low ebb, the valuation of high-end brands will be higher. At the present stage, there is a value depression, and the acquisition is just right at that time.

　　 Fear of capital and integration difficulties

But there is always a distance between dreams and reality. In the process of merger and acquisition, there are many problems such as resource integration, financial control and so on.

Zhu Qinghua pointed out that mergers and acquisitions have further drag on the risks of enterprises. "Mergers and acquisitions may lead to slow growth of business performance due to improper integration and inadequate allocation of resources, which may lead to financial crisis, resulting in financial chain breakage, especially the acquisition of high-end brands and higher costs."

Another industry analyst said that after the introduction of multiple brands, the effective integration of resources is the key. "This includes not only the integration of brands, but also the integration of management and culture between two companies, which will cost a lot of time and money for enterprises". The industry said.