The hazardous waste treatment market continues to heat up, with a series of mergers and acquisitions sparking an investment frenzy, and the industrial landscape also facing more intense competition. At the same time, following the 60% vacancy in hazardous waste treatment and the layered increase in policies, there is a more standardized market order and stricter supervision. Industry insiders remind that the hazardous waste industry cake is tempting, but caution is still needed when entering the market.
Cold Thoughts Behind Market Warming: Should Hazardous Waste Disposal Enter the Market?
"Many people now believe that hazardous waste has high profits and are eager to enter this field, but I think it is necessary to calmly deal with this overheated phenomenon." On December 9th, Zhao Lijun, President of the Environmental Chamber of Commerce of the All China Federation of Industry and Commerce, told the "China Times" at the 2017 China Environmental Protection Listed Companies Summit.
Hazardous waste, abbreviated as "hazardous waste", refers to waste with hazardous characteristics that is listed in the national hazardous waste list or recognized according to the national hazardous waste identification standards and methods.
In recent years, with the introduction of a series of policies and the tightening of environmental law enforcement, the hazardous waste market has ushered in a spring, and many environmental protection enterprises have rushed into the hazardous waste field to "race around". According to the Forward Industry Research Institute's Market Outlook and Investment Analysis Report on China's Hazardous Waste Treatment Industry, it is predicted that by 2020, China's hazardous waste market is expected to form a scale of over 200 billion yuan.
However, Zhao Lijun stated that he has also heard that some companies have spent a lot of money in the past few years to purchase qualifications for hazardous waste treatment, hoping to get a share of the lucrative hazardous waste market, but the results may not be satisfactory.
Merger frenzy
In the view of Xue Tao, Executive Director of E20 Research Institute, the hazardous waste field is experiencing a wave of mergers and acquisitions.
On December 5th, Xue Tao forwarded a news article titled "Dongjiang Environmental Protection Joins Hands with Conch Entrepreneurship to Promote Healthy Industry Development". The content stated that the day before, Dongjiang Environmental Protection announced that the company plans to sign a "Strategic Cooperation Agreement" with Conch Entrepreneurship on December 6th. The two sides have reached a strategic cooperation intention on the collaborative disposal of solid waste in cement kilns, and will further promote the realization of strong cooperation and complementary advantages between the two sides in the field of solid waste treatment.
Since the beginning of this year, multiple listed companies have successively crossed boundaries in the field of hazardous waste. According to statistics from China Solid Waste Network, as of August, the hazardous waste industry has initiated 16 mergers and acquisitions, with a cumulative transaction amount of 2.883 billion yuan.
For example, Bishuiyuan fully acquired Dingzhou Jihuan Hazardous Waste Treatment Co., Ltd. and Dingzhou Jingcheng Environmental Protection Technology Co., Ltd. for 75 million yuan. The two companies have a total hazardous waste incineration disposal scale of 9500 tons/year, a waste activated carbon disposal scale of 15000 tons/year, and a sales volume of approximately 3000 tons/year of recycled activated carbon. By 2020, the incineration disposal capacity will be expanded to 29000 tons per year.
In September, Dongjiang Environmental Protection invested 130.4 million yuan to acquire 80% equity of Tangshan Wandes, 48 million yuan to acquire 30% equity of Fulong Environmental Protection, and 1.5 million yuan to acquire 10% equity of Huateng Environment, continuously expanding its territory in the hazardous waste field.
In mid October, CICC Environment plans to issue shares and pay a total of 1.85 billion yuan in cash to acquire 100% of Jintai Lai's shares at an 8-fold premium, entering the field of hazardous waste treatment.
In addition, environmental protection companies such as Qidi Sound, Hanlan Environment, Ba'an Water, Jinyuan Shares, Kangda Environmental Protection, and even real estate tycoon Yajule have entered the hazardous waste industry in an attempt to seize this "blue ocean".
In early December, the Ministry of Environmental Protection issued the "2017 National Annual Report on Solid Waste Pollution Prevention and Control in Large and Medium sized Cities", which showed that compared to 2006, the actual operating scale of hazardous waste increased by 448% in 2016.
60% processing gap
The sudden rise in the hazardous waste market is related to policy escalation.
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