From Financial Times:
Danone, the French food and drinks group, has initiated legal action against its main joint venture partner in China, raising the stakes in a ferocious dispute that has threatened the future of the lucrative drinks business.
The French group has sent a letter to Zong Qinghou, the chairman of its joint venture partner Wahaha, which says that Danone could begin litigation in 30 days if the two sides cannot reach agreement. Danone has accused Mr Zong of setting up a parallel operation to the joint venture that makes and sells the same products.
Danone’s joint venture with Wahaha, which was first signed in 1996 and sells water, yoghurt and tea drinks, has been one of the most successful in China over the last decade and has helped turn the Wahaha brand into one of the most recognised in the country.[Full Text]
