Dozens of Wahaha employees took to the street yesterday to
protest the alleged takeover bid by Groupe Danone SA of its Chinese
partner.
Wahaha employees in Shanghai yesterday
hold a banner saying, "We want Zong Qinghou. We oppose Danone." The
employees were angry over an alleged takeover bid by Danone of its
Chinese partner.
Wearing yellow shirts and holding the banners, the protesters,
who work for one of the companies' joint ventures, stood in front
of a hotel where a Danone-organized news conference was scheduled,
shouting "Oppose Danone" and "Boycott Danone".
"They expelled our boss," one employee said, referring to the
recent resignation of Zong Qinghou, former chairman of the joint
ventures and founder of Wahaha.
"We have been following chairman Zong for many years. We've
learned from Danone's acquisition of Chinese beverage maker Robust
that there is no happy ending for employees in a hostile takeover,"
another worker said, adding that the protests were spontaneous.
The group gathered at about 9 AM yesterday and was dispersed by
police one hour later.
Danone, which holds 51 percent of 39 joint ventures with Wahaha,
presented a much different picture of its five-month dispute with
China's largest beverage maker. The company accuses Zong of
illegally producing and selling products identical to those sold by
the companies' joint ventures, in violation of agreements between
the two companies.
Emmanuel Faber, Danone's managing director for Asia and interim
head of joint ventures, pointed out that Zong, walking away on his
own volition, has once again used public opinion to serve his
personal interests.
"This mode of interaction is really consistent with Zong's
communication and strategy since the early part of the
discussions," he told reporters during the news conference
yesterday in Shanghai.
"Basically, he was trying to leverage media, the public,
employees, distributors and the government to support his themes,"
Faber added.
Faber hinted that the protests yesterday were orchestrated by
Danone's Chinese partner.
"You think the group of people that tried to prevent me from
attending this news conference in front of this building has
learned by themselves that Danone has a news conference this
morning here?" he said.
"This simply means that there is obstruction being constantly
made to the way that Danone can protect the interests of joint
ventures and their shareholders, including the government of
Hangzhou."
He added: "If I cannot freely access this public building, can
you imagine if I'm trying to push open the door of (joint venture)
factories just to be told that I cannot be there?"
Faber said Danone has no intention of taking further legal
measures against the "unauthorized" businesses started by Zong, and
it is convening board meetings with directors newly appointed by
Wahaha after Zong's departure.
A channel remains open between Zong and Danone to address the
dispute peacefully, Faber said. He spiked rumors that a third party
has been involved in their search for a solution.
Fuel was added to the fire after the Paris-based company filed a
lawsuit last Monday in US over alleged illegal sales in China by
companies run by Zong's wife and daughter.
Zong resigned shortly after, and in an open letter he said two
of the joint ventures' French board members - including Faber - had
"insulted and framed" him during the 10-year partnership. He also
alleged the French company poached employees from the joint
ventures.
Faber fought back yesterday: "If you know Zong, it's hard to
believe that he can be trapped, bullied or framed by whatever
European wise guys."
He added that neither he nor other Danone managers ever gave
instructions to hire or seek to hire employees from the joint
ventures.
Open letters are circulating online claiming to represent all
Wahaha employees and opposing the alleged hostile takeover. Faber
questioned the letters' authenticity yesterday.
"The content of these letters does not indicate why these
employees are worried," he said. "Their styles look like they are
being written by one person."
The feud between Danone and Wahaha surfaced five months ago,
when Zong publicly rejected a plan by Danone to buy out Wahaha's
remaining assets beyond joint ventures for 4 billion yuan, accusing
the French company of attempting a hostile takeover.
(China Daily June 13, 2007)
