A Controversial Acquisition

Stewart Hamilton and Jinxuan Ann Zhang
Additional contact information
Stewart Hamilton: IMD

Chapter 5 in Doing Business with China, 2012, pp 40-50 from Palgrave Macmillan

Abstract: Abstract During the public dispute, Danone claimed that Wahaha had breached its noncompete obligation in the joint venture agreement. Yet, as Zong and Wahaha employees pointed out on different occasions, Danone formed partnerships with other major industry leaders in China, including the acquisition of Wahaha’s closest competitor Robust despite strong objections from Wahaha. The fierce price war waged by Robust in the purified water business following the takeover almost wiped out margins, hurting both companies financially. According to Danone, however, Zong was personally involved in their acquisition of Robust, and he had received “handsome” compensation (reportedly over US$1 million by means of share buyback from an overseas subsidiary1) from Danone for the “services” that he provided.

Keywords: Bottle Water; Energy Drink; Share Buyback; Capital Constraint; Regional Headquarter (search for similar items in EconPapers)
Date: 2012
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-30545-8_6

Ordering information: This item can be ordered from
http://www.palgrave.com/9780230305458

DOI: 10.1057/9780230305458_6

Access Statistics for this chapter

More chapters in Palgrave Macmillan Books from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().