Domestic beverage makers will submit proposals to the Ministry of Commerce to block Coca-Cola Co's takeover of Huiyuan Juice Group Ltd, Beijing Morning Post reported yesterday.
The ministry will hold a hearing to seek opinions about the acquisition and Beijing Shunxin Qianshou Fruit Beverage Co will lead domestic juice firms to offer three proposals to defend the brand and prevent a monopoly from being created after the takeover , the newspaper cited an industry source.
The alternatives include splitting Huiyuan and selling pieces to major Chinese companies, or selling Huiyuan's assets to Coca-Cola but leaving its name to domestic firms. There was a suggestion to form a joint fund to buy Huiyuan, the newspaper said.
Coca-Cola said on September 3 that it had secured approval from shareholders of Huiyuan to acquire nearly 66 percent of the firm for about US$2.4 billion in cash.
The proposal has sparked criticism in China over the possible sale of a prominent national brand to foreigners. State media said the offer must be reviewed under an anti-monopoly law.
All mergers must undergo an anti-monopoly review if the company created by the deal would have revenue of 400 million yuan (US$58 million) in China or 10 billion yuan globally, said a government notice on August 3.
Huiyuan is the top Chinese fruit juice maker with 42 percent of the market. Taking over Huiyuan will give Coca-Cola 60 percent of China's juice market, according to the Beijing newspaper.
(Shanghai Daily September 16, 2008)
