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Alliance and Acquisitions ch 12

Alliance and Acquisitions ch 12 - with profits of 130mm...

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Click to edit Master subtitle style 1/22/11 Alliance and Acquisitions Strategic Alliance Non-equity vs. Equity-based Alliance Strategic and Organizational Fit
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1/22/11 Opening Case: Danone and Wahaha
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1/22/11 Danone in China 1996, formed 5 JV (cost of 170mm) with Wahaha group (founded in 1987) 2006, 39 JVs together 1996 sales 100mm to 2.25 billion in 2006 From 1996 – 2006, Danone was paid 307mm in dividents
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1/22/11 Dispute By 2006 Wahaha has 70 subsidiaries, with 39 of them had JV with Danone 2006, Danone wanted to purchase Wahaha’s other subsidiaries with 500mm offer price Wahaha refused – book value of non- JV subsidiaries assets were 700mm
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Unformatted text preview: with profits of 130mm. Price earning ratio at 4. 1/22/11 Legal issues • JV agreement: subsidiary JVS exclusive rights to produce, distribute, and sell food and beverage products under the “Wahaha” brand. • Every product using “Wahaha” brand should be approved by the board of the master JV. • Danone thus claimed the non-JV 1/22/11 Ending • 2007- 2009, 21 lawsuits and arbitrations in British Virgin Islands, China, France, Italy, Sweden and the U.S. • Danone spent 83m in legal fees for 3 years. • 2009 Sept, Danone gave up 51% in the JV and sold it to Wahaha....
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