The now famed conflict between Groupe Danone, a French food and
beverage giant, and Wahaha Group, China's largest drink maker, has
caused a marked drop in their joint venture businesses' profit
margins. Danone indicated in its first half-yearly financial report
that Danone-Wahaha joint venture sales would drop sharply in the
second half of 2007 due to the litigation.
According to this report, Danone's beverage business reaped
2.139 billion euros in the first half of 2007, up only 4.7 percent
over that in the same period of 2006, indicating a major
slowdown.
In addition, the joint ventures, Groupe Danone's most important
investment in China, only netted the company 1.2 billion euros in
sales, accounting for 7 percent of its total turnover. An insider
estimated the company could see as much as 33 percent drop in sales
because of the ongoing dispute between the two companies.
For more details, please read the full story in Chinese. (http://www.bbtnews.com.cn/news/channel/political25039.shtml)
(China.org.cn August 1 2007)
