Wahaha Joint Venture Company

Wahaha Joint Venture Company
(娃哈哈合资公司)
Company typeprivate
IndustryFood
Founded28 March 1996
Defunct2009
SuccessorHangzhou Wahaha Group
HeadquartersHangzhou, China
Area served
China
Key people
Emmanuel Faber (Chairman)
ProductsDairy products, Water, Soft drinks
Revenue€100 million
5%
ParentGroupe Danone, Hangzhou Wahaha Group
Websitewahaha.com.cn

The Wahaha Joint Venture Company was a food and beverage joint venture company established between the Hangzhou Wahaha Group, the largest beverage producer in China,[1] and Danone, one of the world's largest food conglomerates.

The companies became partners in 1996 in a business model Forbes magazine hailed as a "showcase" joint venture.[2]

As the businesses expanded and became more complex, Danone made several attempts to buy out Wahaha, but was rebuffed.[3] Danone and Wahaha's general manager Zong Qinghou signed a deal in December 2006, allowing Danone to buy a majority stake in the non-JV operations. However, Zong had second thoughts about the deal and reneged,[4] claiming the offer was underpriced.[5] It is alleged that he wanted to squeeze a higher price out of Danone.[4]

In a trademark dispute, Danone filed for arbitration in Stockholm on 9 May 2007.[6] Danone took further legal action by filing a suit in Los Angeles Superior Court against Ever Maple Trading and Hangzhou Hongsheng Beverage Co Ltd on 4 June 2007,[7] companies controlled by Zong's wife and daughter.[8]

On 21 December 2007, Danone and the Chinese partner agreed to suspend their legal battle and resume negotiations.[9] In 2009, Danone Group exited the joint venture by selling their 51% stake to Wahaha Group for an estimated $500 million.[10]

  1. ^ "Danone set to sue Wahaha over breach of contract". South China Morning Post. Hong Kong. 11 April 2007. p. B3.
  2. ^ Elaine Kurtenbach (27 June 2007). "Wahaha-Danone Feud Highlights Pitfalls". Forbes. Retrieved 17 July 2007.[dead link]
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  10. ^ Barboza, David (1 October 2009). "Danone Exits China Venture After Years of Legal Dispute". The New York Times.