Wahaha’s chairman resigns, backing down from Danone legal suit

Wahaha Joint Ventures’ Zong Qing Hou has resigned, removing himself from Danone’s direct line of fire after illegally selling products under their joint venture.

The beleaguered chairman gave notice to the board soon after the French manufacturer filed charges, ending the short-lived skirmish over breach of contract. He is replaced by Emmanuel Faber, currently serving as vice chairman, who will act as interim chairman.

”Danone’s objective has been, and will always be to ensure the development of the JV companies, their brands and employees,” says Faber. “We are looking forward to the continuous development of the Wahaha Joint Ventures.”

Danone also voiced its complaint to the Hangzhou government on the matter, both because the body is an important regulatory authority and a significant minority holder in the Joint Ventures.

The manufacturer’s relationship with Wahaha soured after the Chinese company leveraged the reputation of the world's number one beverage water bottler to market and distribute its own products.

Danone owns 51 percent of the joint venture, while 49 percent is controlled by Chinese shareholders.