Chinese School - Interim chairman of Wahaha remains absent

BIZCHINA / Wahaha vs Danone

Interim chairman of Wahaha remains absent

(Xinhua)
Updated: 2007-06-12 13:34

Zong Qinghou, Wahaha's founder
The new interim chairman of Wahaha, who was appointed to the post by
French food giant Danone last week, can expect a hostile reception when
he shows up to work here, says a spokesman for the Chinese company.

Emmanuel Faber, who replaced Zong Qinghou -- founder and chairman of
Wahaha Group, hasn't yet shown up for work since he was appointed last
Thursday, leaving Chinese employees feeling uneasy and furious, Wahaha's
spokesman Shan Qining told Xinhua on Monday.

Shan said employees at Wahaha's three major production plants signed a
petition supporting their former president the day after Zong resigned.

Shan says employees have been in a hostile mood since learning of the
appointment of Faber and are demanding a clear declaration from Danone
about the future of Wahaha and their jobs.

Calls made by Xinhua to Danone were not immediately returned. Faber is
president of Danone's Asia-Pacific region and was Vice Chairman of Wahaha
before being elevated to interim president.

In his letter of resignation, Zong requested that all staff keep their
jobs. Danone promised in a statement that Chinese employees will not be
affected by the board room struggles.

The feud between Danone and Wahaha, China's drink giant, began last year
but was made public in April.

Danone has accused Hangzhou-based Wahaha of violating their 1996
agreement by illegally setting up companies outside their joint venture.
Danone is demanding a 51-percent stake in the companies.

Wahaha says the joint venture agreement was never approved by China's
trademark office and so is invalid and unenforceable.

Wahaha and Danone have built 39 joint ventures since 1996, with Danone
holding a 51-percent stake.

Danone has filed a lawsuit in the United States against the companies it
says are using the Wahaha name to sell products outside the scope of the
original joint venture agreement.

(For more biz stories, please visit Industry Updates)

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