Wahaha,Danone torn over statements

By Wang Zhenghua (China Daily)
Updated: 2007-06-25 07:43

SHANGHAI: French food and beverage giant Groupe Danone SA yesterday called on Chinese drinks maker Wahaha to ensure the smooth operation of their joint ventures as the long-simmering tensions between the two companies could hurt sales.

Danone, which owns 51 percent of the 39 joint ventures it has with its estranged partner Wahaha, also expressed shock yesterday at Wahaha's decision to reveal information from the joint ventures' board meetings, which ended on June 21. The information should have been kept confidential.

"What has taken us by great surprise is that (Wahaha) publicized in an incomplete way the important contents discussed during the meetings - only several hours after they ended," the French company said in a statement delivered via Ogilvy Public Relations.

For their part, directors of Wahaha, without identifying themselves, yesterday released a detailed account of the friction during the meetings.

According to Wahaha, Danone hired a dozen bodyguards to observe the meetings, which took place at the Hangzhou headquarters of Wahaha Group. They said the Chinese side alerted police after Emmanuel Faber, the French company's Asia-Pacific region president, left without notifying the Chinese directors.

"Don't measure our noble heart by your own petty mind," the board members were quoted as saying in the statement.

The feud surfaced as Zong Qinghou, founder of Wahaha, rejected Danone's bid to buy out some of Wahaha's assets, while Danone alleged that some companies linked to Zong's family are selling Wahaha-branded products identical to those marketed by their joint ventures.

The dispute heated up after Danone filed a lawsuit in the US, and the 62-year-old Zong resigned as chairman of the venture early this month.

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