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"The middle processing is mainly subject to the capital dilemma. The amount of recycling of each enterprise is quite different. It takes at least 1 year for subsidies issuing. Listed companies have smooth financial channel and the volume of recycling is gradually expanding. Most Sees do not have sufficient production capacity, this is the good time for the industry to carry out integration and layout." Mingqiang Deng, the deputy general manager of Senlan Environmental Protection, told reporters that a industry which is small, public, loose and lack of core competitiveness is difficult to innovate and develop, and it's hard to enter the global market.

Thus, since last year, although the profit model still relied on government subsidies and policy support to some degree, but the M&A case of the e-waste recycling and dismantling industry has begun to increase. The reporter learned through the industry insider that currently Sander Environment (30.62 +0.72%, consulting) (000826.SZ), Dongjiang Environmental Protection (17.33 suspension, consulting) and other companies have corresponding M&A plans.

However, the cooperation and M&A usually occur at both ends between the upstream and downstream.

In May of this year, second-hand electronic equipment e-commerce Aihuishou announced  the completion of round B financing of 8 million US dollars, led by the International Finance Corporation (IFC), existing investors - Morningside Ventures and investment followed up, and it also invested 2 million US dollars for Aihuishou in 2011. It is understood that Aihuishou was established in 2011, mainly providing recycling and replacement services for second-hand electronic equipment such as mobile phones and digital products.

"The problem of the enterprise is how to expand the scale. At present, offline recycling is restricted by the region." Kaihua Xu told reporters that disassembling of e-waste should be the economies of scale, and the costs of logistics and manpower are relatively high for disassembling enterprises. GEM will move from the existing multi-level offline recycling network to the nationwide e-commerce recycling network to achieve “iCloud recycling” of e-waste.

At present, GEM is cooperating with Aihuishou, the former mainly recycles e-waste based on mobile phones. The numbers of mobile phones recycled every day is close to 2,000 

including 300-400 scrapped and old ones.

Industry insiders told reporters that in the formal disassembling enterprises, if the journey of supply of goods exceeds 2H, it will lose money because of the high cost, and the scale is an important index for the disassembling industry. Guiyu Town in Guangdong Province, a center of disassembling and refining which was formed in the early stage in China, has always been regarded as the “holy place” of the underground disassembling  industry, which is because it controls the recycling channels throughout the country.

Kaihua Xu thinks, urban mines are decentralized systems that need to be mined in a decentralized manner while the online system is an open one. With the convenient logistic system, online recycling will be leading type of the recycling model in a company. Especially for personal privacy products like mobile phones, consumers do not dare to hand it over to the guerrillas except the 3rd platform.

In March last year, Dongjiang Environmental Protection and Amoy China established a Joint-venture  company to invest in the construction of waste mobile phone disassembling  and resource utilization projects. Dongjiang Environmental Protection built a recycling     system for waste and used mobile phones through the resource recycling platform of    Amoy China.The other side is the industry chain integration in downstream.Since the acquisition of 60% stock rights in Yangzhou Ningda Precious Metals Co., Ltd. in June 2014 with USD 300 millions, at the GEM's temporary stockholders meeting on March 5, the shareholders voted again to the M&A plans like a 49% stake in Kailik, 49% in Dulwich GEM, 65% in Zhejiang Dewey, and a plan of up to 3 billion RMB.   The acquisition of Zhejiang Dulwich is actually to help GEM to get through the way to  recycle the tungsten resources, turn it from waste to tungsten materials, and then to hard alloy devices, said by Kaihua Xu, "This is a complete industrial chain from 'waste recycling - material re-preparation – device re-manufacturing''.

However, in June, Gezhouba (6.05 +2.54%, consulting); Chifeng Gold (19.19 -0.16%, consulting) both announced that the "expansion" in the downstream, go on the recycling of renewable resources, sorting, renewable raw materials, etc..

"Environmental protection is an industry with burden and humiliation. Now many capitals may come in for profit." Kaihua Xu told reporters that the development direction of the circular economy enterprises is to promote the level of resource and industrialization by   letting more companies with superior resources enter in but rather than more and more  factories instead. He said that the threshold for the disassembling industry is gradually    improving, but the companies that entered might have 100 scores and 60 scores, and the enterprises will achieve economies of scale through the independent competition.