The most talked about among China's richest people in 2020 and 2021 is Zhong Suishan, who topped the list of China's richest people with the successful listing of Nongfu Shanquan, successfully defeating Ma Yun, Ma Huateng and other Internet giants. According to the 2021 Hurun Global Rich List rankings, Zhong Ishao's net worth is as high as 550 billion yuan, ranking seventh in the world and first in China.
500 billionaire Zhong Jing
China's wealth top 20, Zhong Sui ranked first
At this time, everyone was surprised to find that it turned out that selling water could make so much money, and in 2021, when Internet companies were invincible, they could even become the richest man in China.
The protagonist of the capital story to be told today is Wahaha, a Series of Love-Hate Stories between China's drinking water "predecessors" established in 1987 and Danone in France.
<h1 class="pgc-h-arrow-right" data-track="8" >1, the establishment of Wahaha: the collective economy, the 80s entrepreneurs can not bypass the hurdle</h1>
In 1987, Zong Qinghou and two retired teachers contracted the distribution department of the school-run enterprise in Shangcheng District, Hangzhou. Zong Qinghou was 42 years old at the time. Faced with this distribution department that has been losing money for many years, he had no choice but to sell people's sodas, popsicles and stationery paper. At the age of 42, he pedaled three wheels to sell popsicles and became the label of Zong Qinghou. So that after becoming famous, everyone can remember the hardships of his entrepreneurship.
The following year, Zong Qinghou began to process oral liquid for others.
In the third year, Hangzhou Wahaha Nutritional Food Factory was established, and Zong Qing later served as the director of the factory.
In the following years, Wahaha continued to invest and acquire, and by 1996, Wahaha's output value had exceeded the 100 million yuan mark.
However, just like Vanke and Wang Shi, the Chinese Academy of Sciences and Liu Chuanzhi, trapped by the system at that time, Wahaha had to wear the "red hat" of the collective economy.
The earliest Wahaha Group was a wholly state-owned enterprise.
In the 1980s and 1990s, when there was no equity incentive, the equity of a part of the collective enterprise was obtained through various means, and the leaders of the collective enterprise used extraordinary means.
<h1 class="pgc-h-arrow-right" data-track="15" >2, the introduction of Danone, the loss of control</h1>
In 1996, Wahaha introduced French beverage giant Danone.
In 1996, Wahaha, Danone and Hong Kong Peregrine jointly funded the establishment of five joint venture companies to produce products with "Wahaha" as the trademark, including pure water and eight treasure porridge.
The reason for the introduction of Danone is "market for technology", through Danone, the introduction of advanced technology and management operations, and the expansion of production capacity.
But some people say that this is just one of the steps zongqinghou "sought" Wahaha.
In the end, Danone spent a total of US$45 million + RMB50 million on trademark transfer funds to obtain a 51% stake in the joint venture (some of which was purchased from Hong Kong's Best Fuller after the financial crisis).
The second step was to acquire state-owned capital after the reform of the property rights clarification movement in 1999.
In the end, Zong Qinghou acquired a 29.4% stake in Wahaha Group.
<h1 class="pgc-h-arrow-right" data-track="26" >3, a sentence in the contract, leaving thousands of hidden dangers</h1>
Despite the introduction of Danone, with years of prestige and tough work style, the dominance of the entire Wahaha Group is still in the hands of Zong Qinghou. Even at the beginning of the cooperation with Danone, Zongqing Hou Bureau and Danone "about four chapters":
First, the brand remains unchanged; second, the position of the chairman remains unchanged; third, the treatment of retired employees remains unchanged; fourth, employees over the age of 45 are not allowed to be dismissed.
At that time, Danone proposed to transfer the trademark right of "Wahaha" to the joint venture company, but the State Trademark Office refused.
The Trademark Assignment Agreement was not approved, and in 1999, Danone signed a Trademark Licensing Contract with Wahaha.
It is this contract that Makes Zong Qinghou regret it, and it is this contract that has become an important dependency for Danone to sue Wahaha.
In the future, the Chinese side may use the (Wahaha) trademark in the production and sale of other products, and these product items have been submitted to the board of directors of Wahaha and its joint ventures for consideration...
Simply put, in addition to the joint venture company, the use of the Wahaha trademark by the Wahaha Group in the future must be agreed by Danone and the joint venture company, and the agreed period of this contract is 50 years.
This is no different from the transfer of a trademark.
<h1 class="pgc-h-arrow-right" data-track="36" >4, disagreements, Zong Qinghou established a series of non-joint ventures</h1>
In the mid-to-late 1990s, zongqinghou and Danone's cooperation became increasingly unpleasant: zongqinghou wanted to expand scale and set up factories across regions, especially in response to the call of the state to participate in the construction of the western region, mountainous areas and poor areas. But Danone, as a capitalist, did not agree; in addition, Danone acquired Robex, which made Wahaha feel pressure.
Finally, since 1999, Zong Qinghou began to establish a non-joint venture company. In 2006, the number of non-joint venture companies had reached more than 60, which has exceeded the number of joint venture companies.
In 2006, the assets of this group of "in vitro companies" reached 5.6 billion yuan, and the profit of that year was 1.04 billion yuan.
<h1 class="pgc-h-arrow-right" data-track="42" >5</h1>
Danone's performance in non-joint ventures has made Danone very popular, although since 1999, Danone has known about the establishment of each joint venture.
Pigs, fattened, will be killed.
Danone wanted to forcibly acquire these joint ventures on the grounds of illegal use of the "Wahaha" trademark, and only bid 4 billion yuan.
This is a condition that Zong Qinghou and the management absolutely cannot accept.
Danone proposed that non-joint venture companies should not use "Wahaha", and the "Wahaha" trademark can only be used in the joint venture company, which is also unacceptable to Zong Qinghou.
Beginning in 2006, Wahaha and Danone began a two-year war of words.
Danone: China President Fan Yimou said that the two sides signed a contract, the contract is protected by law, the two parties should be executed in accordance with the contract, and the non-joint venture company illegally uses the "Wahaha" trademark, and the breach of contract is in front.
Wahaha said: Danone's capital and technical investment after the joint venture are not enough; the contract signed by Danone and Wahaha is inconsistent with the trademark office contract on the right to use the trademark, which is a yin-yang contract; the content of the trademark license is not recorded with the trademark office; the unilateral restriction of the right to use the trademark violates the principle of fairness, and Danone acquires Loeb, resulting in competition for Wahaha. Zong Qinghou hoped that France's Danone would withdraw the funds. Wahaha takes back the stake.
The Bureau of Commerce, as an arbitrator, remains neutral as always: favoring the Chinese side and influencing investment; favoring Danone and losing assets.
<h1 class="pgc-h-arrow-right" data-track="53" >6, Zong Qinghou's means</h1>
In 2006, Zong Qinghou was interviewed by the media and said:
"Due to the unclear understanding of the meaning of trademarks and brands at that time, wahaha's development fell into the trap carefully set by Danone."
"The cooperation is not pleasant, the original intention is that the market has changed technology, and now the technology has not been exchanged, and the market will be lost."
"The worst plan is to lead the entire Wahaha team out."
Zong Qinghou became a "tragic" national hero, and all sectors of society began to pay attention to the malicious mergers and acquisitions of foreign monopoly capital. Celebrities and netizens, and even some local enterprises (mainly wahaha factories) began to show solidarity with Zong Qinghou.
<h1 class="pgc-h-arrow-right" data-track="61" >7, Wahaha anti-acquisition joint venture</h1>
After the failure of the 4 billion yuan acquisition of the non-joint venture company, Danone asked Wahaha to buy back the equity in the joint venture company for 20 billion yuan, which was rejected by Wahaha.
Danone, which can't buy or sell, has been suing Wahaha since 2007. The two sides fought several 23 lawsuits at home and abroad. Both ended in Danone's defeat.
On September 30, 2009, Danone and Wahaha settled, and Wahaha bought back 51% of the joint venture for 3 billion yuan.
Including the profits shared in the early stage, Danone originally invested 45 million US dollars, and the real income exceeded more than 6 billion yuan.
<h1 class="pgc-h-arrow-right" data-track="67" > ending</h1>
In international mergers and acquisitions, cross-border capital has experience and means far more than budding domestic capital. In particular, the harsh conditions in the contract when acquiring will often become a trap for the company in the future.
Whether it is the Nanfu battery or the Dabao SOD secret that was hidden in the snow, even including the wahaha competitor Lebaishi at that time. After being acquired, it is always difficult to live. In the face of too strong opponents, they do not have the confidence to fight.
And the Wahaha incident tells us that instead of giving it to others for a lifetime, it is better to fight to the death. Even from a business point of view, Zong Qinghou's behaviors such as selling miserably and threatening to lead the team to run away do not seem to be so "generous".