04 Oct 2012 From popsicle maker to beverage billionaire, China’s richest man
He had been a poor kid himself, “really poor” he said with a rueful laugh in a recent interview, and he often went hungry. When he started a little stall at a primary school in 1987, hawking soft drinks and popsicles, he saw plenty of hungry children pass by every day.
Zong Qinghou was moved to invent a vitamin drink, which he called Wahaha Oral Liquid, and the schoolkids apparently went for it. “It solved the problem of kids who didn’t want to eat and suffered from malnutrition,” he said last summer in a BBC interview.
Twenty-five years later, as founder and chairman of the Wahaha beverage group — the company name means “laughing child” — Zong is China’s wealthiest person. A new list of the richest people on the mainland puts the net worth of Zong and his family at $12.6 billion.
Wahaha has 60 production bases in 29 provinces in China, employs 30 000 people and has been the market leader in the country’s beverage industry for the past 14 years.
The 2012 Hurun Report says Wang Jianlin, the chairman of the Wanda real estate development group, is the second-wealthiest, with $10.3 billion. Robin Li, the chairman and CEO of Baidu, the largest Internet search engine in China, is in third place with $8 billion.
An analysis by the business magazine Caixin found that China’s manufacturing sector has replaced real estate as the principal generator of wealthy individuals over the past year.
“While the rankings of wealthy individuals slid in the real estate, energy, natural resources and retail sectors,” the magazine said, “more billionaires emerged in the finance, media and culture industries.”
Entrepreneurs in solar energy, clothing and retail were especially hard-hit, the state news agency Xinhua said.
Zong, who turns 67 this month, was a kid who had no prospects and little schooling. He worked for a time as a laborer in a salt plant. He used a small loan to start his drinks stand and began making his own beverages with 10 employees. In 1989, at the government’s behest, he took over a failing state-owned canning factory in his hometown of Hangzhou.
He was eager to expand his business but the 2 000 factory employees refused to go to work for the private firm. The local media had branded him a capitalist, a label that had decidedly nasty connotations at the time.
“It was a huge negative campaign,” he told the BBC. “At that time the opening-up policy was not really implemented in China. We were still having problems as to whether it was capitalist or socialist.”
Zong finally persuaded the factory people to join his new company. When business took off, the labor discord and political bickering evaporated.
“The results were pretty good,” he said, “so that shut people up.”
Zong has had other corporate battles, notably a bitter falling-out with his joint venture partner Danone, the French food giant…..
International Herald Tribune: Read the full article
Wahaha eyes snacks business
Chinese food and beverage giant Hangzhou Wahaha Group has emerged as one of the contenders for KP Snacks, the snacks business of Britain’s United Biscuits Topco.
The British company, which has under its umbrella popular snack brands such as McCoy’s, Hula Hoops, KP Nuts and Skips, is being put up for sale by its private equity owners, Blackstone and PAI Partners, for £520-million pounds, according to a report by the British newspaper, Sunday Telegraph.
According to experts, such moves typify the efforts being made by Chinese companies to acquire superior technologies and brands through overseas mergers and acquisitions…..