China Putian was integrated into CETC, with a total market value of nearly 700 billion yuan

On the evening of June 23, according to the official website of the state owned assets supervision and Administration Commission of the State Council, China Putian was incorporated into CETC as a whole and became its wholly-owned subsidiary with the approval of the State Council. China Putian is no longer directly supervised by SASAC. The reorganization will involve 15 listed companies with a total market value of nearly 700 billion yuan.

According to the official website, China Putian is a central enterprise directly managed by the state owned assets supervision and Administration Commission of the State Council. Its predecessor originated from the former industrial bureau of the Ministry of Posts and telecommunications and China Post and Telecommunications Industry Corporation. Its business covers information and communication and network security, intelligent equipment and terminals, intelligent applications, innovation and entrepreneurship Park Services, new energy vehicle charging services and other fields. At present, China Putian has a number of listed subsidiaries, such as Dongxin Heping, Chengdu Putian cable, Dongfang communication and Nanjing Communication B.

China Electronics Technology Group Co., Ltd. (hereinafter referred to as "CETC") is an important state-owned backbone enterprise directly managed by the central government, known as the "national team of network information industry". CETC has a total of 11 listed companies, including Guorui technology, Hikvision, Sichuang electronics, phoenix optics, Jiesai technology, Huadong computer, Westone, Tianao electronics, Taiji Co., Ltd., Zhongci electronics and St power.

The restructuring was first disclosed by China Putian's listed companies Dongfang Telecom and Dongxin Heping on February 24, 2021. Recalling the previous announcement, the two companies said that China Putian, the actual controller, is planning a reorganization with China Electronics Technology Co., Ltd. after the reorganization, the overall property rights of China Putian will be transferred to China Electronics Technology Co., Ltd. free of charge.

Liu Xingguo, a researcher in the research department of the China Federation of enterprises, was quoted by the Securities Daily as saying that the integration of China Putian into CETC is a concrete embodiment of deepening the merger and reorganization of state-owned enterprises and completing the task of structural adjustment and reform. After the merger, the R & D resources of the original two enterprises will be used more efficiently, which is more conducive to concentrate on the breakthrough of key "neck" technologies in the field of electronic information.

China Putian and China Power Technology Co., Ltd. have both upstream and downstream relations in their main business, and some of the same or similar businesses. If China Putian is integrated into CETC as a whole, it can not only quickly complete the business and resource integration of the original industrial chain within the group, but also strongly promote the optimization and reorganization of similar businesses and resources.

According to the analysis of some people in the industry, CETC has a higher level, a very large enterprise scale and complementary resources with Putian. A good technology complementarity can be formed between the two, and Putian's mature product line and market channel can also provide a landing platform for the technology of CETC. The restructuring of these two complementary businesses can eventually play a "1 + 1 > 2" aggregation effect. With the integration of China Putian, CETC will have more advantages in scale, innovation and market to better support China's international competition for digital economy and strategic emerging industries.

According to AVIC Securities Research Report, China Putian and CETC are both large domestic central enterprises, and their business scope covers communication industry and other related fields. CETC is regarded as the "national team" of network information industry, and occupies a leading position in the field of domestic military electronics and network information technology. After this reorganization, it will further strengthen the scale advantage, innovation advantage and market advantage of CETC, and its strategic position will be more prominent.

SASAC said that in the next step, it will accelerate the optimization of the layout and structural adjustment of state-owned capital, better promote the reorganization, integration, adjustment and optimization, create a number of leading enterprises in the industry, leading enterprises in scientific and technological innovation, "specialized and special new" champion enterprises, and backbone enterprises in basic security, so as to better serve and support the major national strategies.