1. In 2024, the scale of mergers and acquisitions increased significantly, and the domestic market showed signs
of integration. According to the incomplete statistics of Cement Big Data Research Institute, in 2024, China's cement enterprises completed 10 cases of mergers and acquisitions (excluding concrete and co-disposal), a decrease of 5 cases compared with 2023. At the same time, the number of projects still in progress in 2024 has further increased to about 28. In addition, the number of cases involving production capacity indicators and the transfer of cement assets continued to increase, with a total of nearly 20 new cases added throughout the year.
In 2024, the number of mergers and acquisitions completed by Chinese cement enterprises decreased, but the number of new mergers and acquisitions increased in that year, the total number of projects in progress continued to increase, and the activity of mergers and acquisitions in the cement industry increased compared with 2023.
Figure 1: Number of mergers and acquisitions completed by China's cement enterprises in 2018-2024 (unit: from)
Data source: Cement Big Data (https://data.ccement.com/)
From the perspective of M & a scale, Mergers and acquisitions completed by Chinese cement enterprises in 2024 involved a total amount of 6.425 billion yuan, an increase of about 80.17% over the previous year, reaching the highest level in the past five years.
Among them, the largest M & a in 2024 came from Taiwan Cement's increase in OYAK and Cimpor shares, with a total purchase price of 621 million euros (about 4.7 billion yuan), accounting for 73% of the total annual M & A price; Secondly, Tianshan Stock and Shangfeng Cement jointly acquired Xinjiang Bohai Cement and Jidong Cement acquired China-Africa Jidong Building Materials, involving 994 million yuan and 500 million yuan respectively, accounting for 23% of the total. In addition, Jidong Cement launched the acquisition of Shuangyashan New Age Cement in December 2024, and the Northeast market integration has taken a substantial step.
It can be seen that in 2024, overseas mergers and acquisitions of Chinese enterprises still account for the majority, but the leading enterprises have begun to gradually promote the integration of mergers and acquisitions in the domestic market, and the cement industry may set off a new wave of mergers and acquisitions.
Figure 2: Total price of mergers and acquisitions completed by Chinese cement enterprises in 2018-2024 (unit: 100 million yuan)
Data source: Cement Big Data (https://data.ccement.com/)
II. The continuous decline of industry efficiency is an important reason
for the substantial progress of industry mergers and acquisitions. In 2024, affected by factors such as sluggish real estate and insufficient increment of infrastructure orders, domestic cement demand continued to decline significantly, and the annual cement output is expected to drop to about 1.8 billion tons, with a year-on-year decline of more than 10%. At the same time, the profits of the cement industry shrank further. In the first half of the year, there was a loss in the whole industry. The total annual profit (excluding the profits of non-cement enterprises such as overseas business and aggregates) is expected to be around 16 billion yuan, with a year-on-year decline of about 30%. In terms of the proportion of loss-making enterprises, it is expected to exceed 50% in 2024, a further increase of more than 10% compared with 2023.
Figure 3: Further decline in domestic cement demand and total profit in 2024 (unit: 100 million tons,
Data source: Cement Big Data (https://data.ccement.com/)
The three consecutive years of declining demand and shrinking profits have brought great challenges to the survival of cement enterprises, but also brought substantial support to the promotion of mergers and acquisitions in the industry.
First of all, the continuous shrinkage of domestic cement business profits has prompted cement enterprises to go out. From 2023 to 2024, the leading enterprises represented by Huaxin Cement have intensified their overseas business expansion, and overseas mergers and acquisitions have become an important part of the mergers and acquisitions of Chinese cement enterprises.
Secondly, the pressure of loss has increased the willingness of SMEs to sell. The downward profit and loss pressure for many years has been eroding the surplus accumulated in the golden period of the industry. In addition, the industry's understanding of the long-term downward demand has become increasingly clear. Some small and medium-sized enterprises have gradually changed their mentality of waiting for the price to sell, and actively seek mergers and acquisitions.
Finally, for domestic leading cement enterprises, market integration helps to maintain orderly competition. In the first half of 2024, the competition in the domestic cement industry intensified, once entering a loss state of the whole industry, and the cruelty of relying solely on the market itself to achieve liquidation was verified. At the same time, the Northeast market has achieved price repair through coordinated production reduction, which has brought a positive case of orderly competition to the industry. Therefore, domestic leading enterprises began to take the initiative to promote market integration. The number and scale of mergers and acquisitions in the cement industry will further expand
in 2025 In 2025, the domestic cement industry will continue to operate under pressure, and it is expected that the number and scale of mergers and acquisitions by Chinese enterprises will further increase. According to the list of promotion projects, the total transaction amount of existing mergers and acquisitions of China Building Materials, Huaxin Cement and Jidong Cement alone has reached about 8 billion yuan, exceeding the level of the whole year of 2024.
Domestic leading enterprises generally regard overseas market as the strategic development direction, and it is expected that the proportion of overseas M & a scale will continue to maintain a high level. At the same time, substantial progress has been made in M & a integration in the northern region, and it is difficult to achieve the integration goal by relying solely on existing landing projects. It is expected that there will be more new projects in 2025, and the scale of M & a in the domestic market will also be increased.
Table 1: Data source of some key merger and acquisition cases
in the cement industry in 2025: cement big data (https://data.ccement.com/)
