BIZCHINA / Developments
Zong demands an apology
By Xiao Wang (China Daily)
Updated: 2007-06-15 07:00
SHANGHAI: The Wahaha chairman has vowed that the fight with Danone will
never end unless the French partner agrees to rescind the alleged unequal
conditions in their contract and tenders a public apology.
Zong Qinghou, Wahaha's founder, refuted a statement released by Danone on
Tuesday that alleged, among other things, that Zong's recent resignation
from Wahaha-Danone joint ventures was "entirely his decision to pursue
his own interests", and that Zong's earlier "open letter" was "either
incomplete, twisted, out of context, or simply untrue".
Zong retorted that Danone's acquisition of Chinese beverage producer
Robust resulted in great losses for the latter in the second year of the
acquisition. "Danone's behaviors in the Chinese market in the past has
proved its hostility toward its joint venture companies," Zong alleged.
Wahaha Chairman Zong Qinghou pictured through a window in Beijing. Lucas
Schifres/Bloomberg News
As for the transfer of the Wahaha brand, Zong said it's meaningless for
Danone to start the related procedure in view of an earlier ruling by the
State Brand Administration that has effectively blocked such a transfer.
Zong also hinted that he would seek a ruling from the Hangzhou Arbitrage
Committee on the disputed validity of certain transactions related to the
brand conditions in the contract with Danone.
In its earlier statement, Danone pointed out that it's inappropriate for
anyone to seek to "leverage" employees, business partners and the public
to support their goal of maximizing their own personal wealth while
endangering the business continuity of the company.
"Danone's objective has been and will always be to ensure the development
of the joint venture companies, their brands and employees. We are
looking forward to the continuous development of the Wahaha joint
ventures," Emmanuel Faber, interim chairman of Wahaha joint venture
companies, said in a recent media statement.
Danone and Wahaha started their partnership in 1996 and five joint
ventures were established under an agreement that bars the latter from
making products that may compete with those of the joint ventures.
The agreement also specifies that the company cannot use the Wahaha brand
without Danone's consent.
Wahaha's spokesman Shan Qining told China Daily that Wahaha is determined
to see a final resolution of the dispute, no matter how long the lawsuit
takes.
(China Daily 06/15/2007 page14)
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