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Acquisition triggers global expansion
By Xia Huan (China Daily)
Updated: 2009-06-30 08:02

 Acquisition triggers global expansion

Boring machinery: state-of-the-art drilling and heavy duty equipment produced at Qier

Many and varied are the innovative routes Chinese businesses have sought out in a bid to maintain growth despite the worldwide economic downturn. For the Qier Machine Tool Group Co Ltd (Qier), a Heilongjiang-based machine tool manufacturer, acquisition proved to be the way forward.

Last year the company was acquired by the State-owned China General Technology (Group) Holdings Ltd (Genertec). The deal saw Genertec acquire an over 50 percent stake in Qier, making it the controlling shareholder. The combined company is now set to try and realize Qier's ambitions to be one of the world's leading heavy-duty machine tool producers.

The acquisition is directly in line with previously-announced State Council plans to revitalize China's equipment manufacturing base. As a result of the deal, Qier now sees itself as ideally placed to develop its expertise and services on a global basis and take a leading role in the national push for world-class excellence in equipment manufacturing across a range of sectors.

With the backing of Genertec, Qier's management now plans to expand the business through acquisitions in both the domestic and international markets. Its newly acquired status as a State-owned company also gives it greater access to technical and financial support from the central government, another boost for its global aspirations.

Speaking after the acquisition, Qu Bo, chairman of Qier, said: "The integration of the two companies provides a greater competitive advantage for manufacturing machine tools in the defense, automotive, aerospace, energy, railway and navy sectors, both within China and on a global basis.

Its acquisition by Genertec is just the latest chapter in the company's illustrious 50-year history. Founded in the 1950s as one of the pioneer enterprises in the domestic machinery industry during the course of the First Five-Year Plan (1953-57), Qier has a half-century of innovation under its belt. During that time it has successfully developed its own high-tech solutions in a number of sectors, including heavy-duty CNC milling-boring machines, heavy-duty mechanical presses, large automatic metal forming machines and a series of milling machines.

Its well-established product range now includes heavy-duty floor-standing milling and boring machines (both CNC type and standard operation) and the automated metal forming machinery. The engineering level of both items represent the state-of-the-art technology within the domestic machinery industry, whilst the company's output and production levels have seen it secure the number two slot within State-owned companies in the same sector.

The company has won many industry plaudits for the undeniably "heavy-duty" nature of much of its machinery. Its combined "heavy-duty" and "super heavy duty" production now represent 80 per cent of its output, whilst its heavy-duty metal cutting machine became its lead product back in 2005.

In addition to its independent and domestic research and development work, the company has also been keen to develop international ties and expand its knowledge and skill base as part of its plans for global expansion. For the future, it is committed to an aggressive policy of restructuring for growth, as well as developing its own proprietarial Intellectual Property Rights (IPR) in its range of innovative equipment.

Looking to the future, Qu said: "We believe the company is now well-positioned to achieve its goal of becoming a world-class advanced machine tool manufacturer, despite adverse trading conditions still prevailing in many global markets."

Corporate culture

Central to the success of the company has been the Ma Hengchang spirit, which is regarded as core of the corporate culture. The spirit generated from the Ma Hengchang Team. The team took its name and inspiration from a legendary industrial team leader of the 1940s. Ma was widely credited with introducing a number of innovations into the workplace, including democratic management, technological research, appropriate allocation of work responsibilities and a more constructive approach to overall management.

Viewed as inspiration in his own lifetime, Ma enjoyed the friendship and patronage of a number of Chinese leaders, including Mao Zedong, Liu Shaoqi and Zhou Enlai. Today the team that bears his name remain highly regarded and their hard work is credited with the creation of over 60,000 sets of machine tools, including a number of heavy-duty metal cutting machines and a metal forming machine said to weigh more than 100 tons. As with their eponymous forebear, the team has also attracted a number of high profile visitors, including Deng Xiaoping, Jiang Zemin, and Hu Jintao.

Through the hard work of the Ma Hengchang Team and many of its peers, Qier is now firmly established as one of the most reputable names in the heavy-duty machinery and forge equipment sectors. It is now also one of the key enterprises in the CNC machine tool industrialization sector to be supported by the State Council.

Acquisition triggers global expansion

(China Daily 06/30/2009 page15)