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Danone, Wahaha Trade Jabs
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Wahaha, China's largest beverage maker, yesterday accused partner Groupe Danone of contract breach, while the French food giant sought the transfer of company stamps and business licenses from the joint ventures' management to the Danone-appointed chairman.


Wahaha yesterday released a letter from Emmanuel Faber, the French company's Asia-Pacific region president, addressed to seven joint ventures. In it, Faber, acting as chairman of the joint ventures, demanded the ventures' management hand over company stamps, licenses and other important documents immediately on Monday.


In the letter, Danone claimed the transfer is in line with legal procedure, since Faber has replaced Zong Qinghou as chairman and resolutions were passed during the board meetings a week earlier.


Danone, which accused Wahaha's illegal non-joint ventures of making competitive products in violation of 1996 agreements, says it wants to ensure important items be put under strict custody and supervised by the new chairman so that they are not used in an unauthorized way.


Wahaha reiterated yesterday that the board meetings among the five directors of the seven joint ventures - including two from Wahaha -did not reach any agreements, adding that Danone's appointment of a new chairman is illegal.


The Chinese directors "did not sign on any resolution prepared by Faber in advance. The decisions made by Danone's three board members are unilateral, which shows that Danone overlooked the rights of the Chinese side while they breached the contracts", Wahaha said in a statement yesterday.


The Chinese beverage maker called Danone's request for a transfer of documents and records groundless.


In the letter copied to general managers of the seven ventures, Danone said the new chairman was legally appointed in a vote during the two-day board meetings in Hanghzhou in eastern China.


(China Daily June 28, 2007)


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