Groupe Danone (Danone) is one of the established multinational companies in the world. The company is a food-product firm that is based in Paris, France, which is currently operating in more than 130 markets across the globe ( Peng, 2013) . In order to enhance its international growth, Danone uses both acquisition and joint venture strategies. Some of the companies that the companies that Danone has acquired through acquisition strategy include Unimilk in Russia, Kraft Food, Centrale in Morocco, and Frank Milk in West Africa. At the same time, it is using joint ventures strategy, particularly to target the emerging economies in Asia, Africa, and Latin America.
The company uses both alliances and acquisitions to expand to the global markets. However, it was its alliance with Wahaha that attracted the attention because of the untimely separation. The Joint venture between Danone and Wahaha was an alliance because they entered in a contractual relationship, as they remained independent (Peng, 2013) . The aim of the alliance was to benefit from the large and growing Chinese beverage industry (Kwok, 2009). However, the two companies were engaged in conflict in 2007 when Danone accused its partner, Wahaha, of operating parallel companies that reflected the joint venture. Danone also accused Zong Qinghou, found and chairman of Wahaha, of orchestrating fraud. As a result, in 2009, the alliance was dissolved, with Danone selling 51% of its stake to Wahaha (Barboza, 2009).
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Therefore, the joint venture between Danone and Wahaha was not successful because they were forced to dissolve in 2009. However, before the collapse of the alliance, the two companies were jointly doing well in the Chinese market. For instance, their joint revenue significantly increased from $100 million to $2.2 billion between 1996 and 2006. The joint venture was successful despite the fact that it collapsed.
References
Peng, M. W. (2013). Global strategy . Cengage learning.
Kwok, V. (2009, September 30). Danone Gives Up China Fight. Forbes . Retrieved from https://www.forbes.com/2009/09/30/danone-wahaha-dispute-markets-business- trademark.html
Barboza, D. (2009, September 30). Danone Exits China Venture after Years of Legal Dispute. The New York Times . Retrieved from http://www.nytimes.com/2009/10/01/business/global/01danone.html
