Friday, March 20, 2009

Huiyuan criticises Coke deal's rejection


Huiyuan criticises Coke deal's rejection
20-03-2009

China's Huiyuan Juice Group says a merger with Coca-Cola could have encouraged competition and benefited consumers. The comments follow Beijing's decision to block the US$2.4-billion deal. The Ministry of Commerce said that it would have had "a negative influence on competition" and forced consumers to "accept higher prices and a smaller choice of products." However, Huiyuan insisted the merger, which would have been the biggest foreign takeover of a Chinese firm, could have brought benefits to the market and China's agriculture and beverage sectors. "An expanding industry will definitely attract more market participants and result in higher sales revenue," said a company statement."All these in turn help promote healthy competition in the market, and ultimately customers will benefit from more choices." A foreign ministry spokesman in Beijing denied that protectionism was a factor in the decision. "The Chinese government's rejection of Coca-Cola buying Huiyuan is an objective judgement based on the anti-monopoly law. It's not trade protectionism," he said. "The decision was to maintain fair competition in the Chinese market."

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