FRANCE: Danone in Wahaha China crisis?
Groupe Danone appears to be on a collision course with one of its joint venture partners in China.
Local reports this week have claimed that Zong Qinghou, chairman of the country's biggest beverage maker Hangzhou Wahaha Group, is resisting moves by Danone to acquire full control of their Wahaha joint venture.
Danone owns 51% of the joint venture, which has the exclusive rights of production, distribution and sales of products under the Wahaha brand, with the remaining 49% resting in Chinese shareholder hands.
"If all of China's major companies are controlled by foreign ones, the lives of Chinese people would be greatly affected," Zong told local reporters. "Our own expansion should not be restricted by foreign partnership and we must own control."
When contacted by just-drinks today, however (11 April), Danone looked to play down the situation. "What we would like to do is integrate the companies developed by Mr Zong into the joint venture," a spokesperson said.
Although the spokesperson confirmed that Danone is in discussions with Zong, she could not elaborate on what stage those discussions have reached, or where they are being held.
"The global idea is that Mr Zong's behaviour is quite usual for someone who is in negotiations with another party," the spokesperson added. "He is trying to put pressure on those negotiations."
While the discussions are "ongoing", the spokesperson would not be drawn on when a conclusion would be reached.
The Wahaha brand covers water, lactic beverages, energy drinks and RTD teas in China.
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