With the Chinese authorities aiming at reducing the number of large state-owned enterprises in the electronics and information industry to one-third, the acquisition plan of five companies by China Electronics has gone one step further. This merger, as part of China's State-owned Asset Supervision and Administration Commission's plan, involves CEC's acquisition of China Great Wall Computer Group, the Nanjing Panda Electronics Group, Nanjing Huadong Electronics Information & Technology, the Nanjing Jinning Electronics Group, and Nanjing Creator Electronic Equipment.
Being a developer of telecommunication equipment, CEC will gain from this acquisition a computer industrial cluster that integrates hardware, software and systems, an integrated circuit industrial cluster, an information home appliances business focused particularly mobile phone manufacturing, high definition digital appliances, audio-video equipment ,as well as a network information businesses focusing on broadband, network equipment and terminal production. The new group will also obtain stronger financing capabilities. Details about the integration of the new group are still unknown and CEC is faced with three major challenges right now: building an effective management system, generating synergies among disparate business groups, and an experience curve in dealing with listed companies.