Reading on Wednesday about BP plc's
battle to maintain control of its Russian oil joint venture, TNK-BP, we couldn't help but be reminded of the
spectacular blowup of Group Danone SA's JV in China. The French dairy company accused Zong Qinghou, founder and chairman of its JV partner Hangzhou Wahaha Group, of starting side businesses that unlawfully used the JVs distributors and suppliers. Zong fired back in the Chinese media, comparing Danone's tactics to those used by Western colonial powers and Japan a century ago to oppress China. Danone and Zong are still trying to resolve their differences and have agreed to pursue
"peace talks," for now.
There are some important differences between these stories that are worth mentioning. First, the fighting over TNK-BP has escalated to a frightening level. The JV's CEO fled Russia last week and, according to BP's CEO, will spend the next few weeks recovering from "personal intimidation" in an undisclosed location. And, overall, the stakes are much higher for BP. China accounts for about 10% of Danone's sales, and the company's JV with Zong is only one of several holdings it has in the country. TNK-BP, on the other hand, is a major contributor to BP's bottom line. During its
Tuesday release of second-quarter earning, BP announced that the JV accounted for 14% of total net income and 24% of global production.
- Suzanne Stevens
Join Corporate Dealmaker's LinkedIn forum
Juergen Lasowski
And the winners are...
