Briefs: Danone, Parmalat and Bulgarian farmer woes
takes a look at some of the major happenings over the
christmas period.
Danone and Wahaha bring peace to business world After increasingly bitter legal wrangles in December between Danone and Chinese partner Wahaha, both parties appeared to find some last minute Christmas spirit, announcing on 21 December that the two parties were returning to peace talks. In a joint statement, the dairy and beverage groups said they were "complying" with calls from their respective governments to terminate current hostilities between the two parties. "Both parties agree to carry out the talks on the basis of adhering to the principles of equality and mutual benefits, to seek common grounds by tolerating minor differences, to reach mutual understandings and to strive for the success of peace talks," the companies stated. The moves represents a strong turnaround from earlier in the month, when Danone, which has had some success in freezing Wahaha's foreign assets, was ordered to terminate its right to trademarks related to the joint venture by a court in the country. Wahaha launched the arbitration request on 13 June this year in a bid to bring to an end a "Trademark Transfer Agreement" (TTA), which meant its brands were exclusively tied to the joint venture companies, according to Danone. Danone and Wahaha have worked under an agreement since 1996 regarding a number of locally-based joint ventures, of which Danone holds a 51 per cent stake. Wahaha has previously criticised this partnership, claiming that is prevents the Chinese company from manufacturing goods that compete directly with products released through the joint venture. Futher settlements for Parmalat Parmalat will receive €310m from the Intesa Sanpaolo Group as part of a settlement over the latter's alleged involvement in the dairy group's 2003 collapse. The group said it had also reached a similar agreement with fellow financial institution Cassa di Risparmio di Parma e Piacenza for €83m, bringing an end to any further action against the two banking groups. The Italian dairy giant's fall created one of Europe's largest financial scandals when the company, under a previous administration, defaulted on more than €14bn in debt in 2003. Under the current leadership of administrator Enrico Bondi, Parmalat has subsequently worked to stave off efforts by an Italian banking conglomerate to disintegrate the group. This has led to the company pursuing various legal proceedings in Europe and the US against banks allegedly involved in having knowledge of the fraud. In September, the company settled disputes with Graubuendner Kantonalbank and Credit Agricole Indosuez out of court for the sum of €20.7m and €2.63m respectively. Parmalat posted financial assets totalling €58.9m during the first financial half of 2007 as a result of these proceedings. By comparison, the group posted net debts of €170m for 2006 full year results. Bulgarian milk producers call for quota hike Last week also saw hundreds of Bulgarian milk producers taking to the streets in protest at the cost of cattle feed, which they claim is crippling their profits, according to news reports. The country's milk producers association believes that farmers need both an increase in EU milk production quotas and higher levels of subsidies to counter the high cost of feeding their livestock, according to the Dow Jones Newswires service The government is said to have until 5 January to respond to its demands, which the association claims would prevent culling 200,000 of the country's 350,000 cows under current production quotas. The calls by the Bulgarian farmers for higher subsidies contravene the EU wide Common agricultural Policy (CAP) reform, which is designed to reduce producer's reliance on government handouts in a bid to step up competition. However, the European Commission is proposing a two per cent rise in milk quotas from April next year in a bid to drive down the current high price of the commodity.
