Media Focus: Hengtai Aipu forward-looking layout timely mergers and acquisitions.

At a time when the reservoir technology service industry is generally experiencing a cold winter in the industry, Hengtai Aipu (300157) still achieved a 35.28 year-on-year increase in operating income in the first three quarters of this year. Forward-looking M & A layout is the key to Hengtai Aipu's growth.

As we all know, since 2013, the anti-corruption storm in the industry started from PetroChina has triggered a slowdown in the release of investment projects in the domestic oil industry. Affected by this, companies in the oil service industry that use domestic users as their main customers have encountered Waterloo, and they are also listed companies. According to the 2014 quarterly report of companies in the industry, more than half of the companies' performance and profits have declined significantly. This means that China's oil clothing industry has entered a stage of structural adjustment.

However, Hengtai Aipu's third quarterly report in 2014 showed that the company achieved operating income of 0.492 billion yuan, an increase of 35.28 percent over the same period last year; net profit attributable to shareholders of listed companies was 93.5296 million yuan, an increase of 16.16 percent over the same period last year. It is around the new development strategy that Hengtai Aipu has enriched and completed the main business chain in a timely manner, which has successfully avoided the inevitable industry fluctuations of a single business and achieved the continuous growth of the main business.

Based on the judgment of the development prospects of the domestic and international oil service market, Hengtai Aipu's management timely adjusted and finally established the company's new development strategy, that is, "to build an international comprehensive oil service company as the goal, implement 3334 system engineering, and realize the company's sustained and rapid development."

Hengtai Aipu's "3334" system engineering is: closely centering on the three strategies of "thickening, lengthening and widening", using the three markets of "domestic, international and capital", and aiming at developing and growing into an international modern oil service company, establish and improve the R & D, sales of key products such as oil and gas core equipment, equipment, instruments and meters, and the ability to provide corresponding engineering operation technical services globally, expand and adjust its main business from the traditional geophysical and geological software and technical services business to include geophysical and geological software and technical services, oilfield equipment and instrument manufacturing, oilfield engineering and technical services, and oilfield production increase services. Comprehensive oil and gas field services divided into four main business segments.

In terms of M & A strategy, it is important for Hengtai Aipu to follow and learn from the experience and experience of large companies such as Schlumberger to explore and develop its own characteristic development path. Play the role of capital platform, in the team building, market share, technology acquisition, reduce competitors and so on. According to the above M & A layout, in recent years, on the basis of the original main business of Hengtai Aipu geophysics and geological software and technical services, it has actively carried out strategic layout and innovation. After acquiring Langfang Xinsaipu, Boda Ruiheng, West Oil Union, Zhongying Anxin, OMEK and other companies in turn, it has formed a comprehensive oil service platform for geophysical exploration, reservoir service, drilling, cementing, well completion, surface engineering, digital oil field, etc, has begun to become an international oil clothing giant potential.

Hengtai Aipu oil service industry chain mergers and acquisitions continue to increase, but the company's value is not limited to the simple accumulation of benefits of each sector, but lies in the merger and acquisition after the completion of the synergistic integration effect. Industry analysts believe that Hengtai Aipu will take advantage of the parent company's technical advantages in exploration and development software, West Oil Union in oilfield engineering, and Boda Hengrui's market advantages to combine new Saipu with Spartek equipment, instruments and other technical advantages. Increase market investment and further increase market share.

After a series of mergers and acquisitions, Hengtai Aipu's main business after listing has fully expanded the traditional business scope before listing. It is through this strategic transformation that the four sectors created by Hengtai Aipu have achieved synergy, which not only achieves the continuous growth of the main business and net profit at present, but also lays a solid foundation for the company's second take-off in the future.

Hengtai Aipu's merger and acquisition is still in progress. On the evening of October 15, 2014, Hengtai Aipu, which had been suspended for several months, announced that the company planned to purchase 100 percent of the shares of Apis Reservoir and 100 percent of the shares of Xinjiang New Generation by issuing shares and paying cash. Energy Prospecting Technology USA Inc. (EPT) planned to purchase 100 percent of the shares of Apis in the United States through cash and raise matching funds not exceeding 280 million yuan.

Hengtai Aipu said that while insisting on developing advantageous businesses, the company has initially completed the layout of the four major business sectors through multiple industrial mergers and acquisitions. The proposed acquisition of the new generation is a professional oil and gas field engineering and technical services company, the United States Apis and Apis reservoir is the oil and gas exploration and development software sales and technical services industry leaders.

Upon completion of the transaction, it will help to enhance the overall size of the listed company and enhance its profitability. At the same time, the company's market expansion ability, anti-risk ability, sustainable development ability and comprehensive competitiveness will also be further enhanced, which is conducive to fundamentally protecting the interests of listed companies and their shareholders, especially small and medium shareholders.

Hengtai Aipu successfully completed a series of mergers and acquisitions in a short period of three years, which has always been regarded as strange and envious by the industry. In 2013, the regulatory authorities repeatedly invited the chairman of Hengtai Aipu to introduce the experience of mergers and acquisitions. He believes that when the industry is booming, we can be prepared for danger in times of peace and make a comprehensive layout; when the industry is in a downturn, we can seize opportunities and boldly merge and merge. Hengtai Aipu's series of mergers and acquisitions have completed the basic layout of the established development strategy, built the aircraft carrier prototype of an international comprehensive oil service company, and opened up space for continued growth in future performance.