Riding the wind of rebirth

When Zhou Zhi finished choosing the dishes and came back to Mai Xiaomiao, Mai Xiaomiao secretly teased Zhou Zhi: "You are so cunning!"

"What else? This is her home ground. Do you want your boyfriend to get beaten?" Zhou Zhi placed a few pieces of meat in front of Mai Xiaomiao: "Here, have this. Your favorite braised duck feet and duck gizzards."

Mai Xiaomiao picked up a duck wing, tore it apart, tore off the piece of meat between the two bones and fed it to Zhou Zhi: "You eat too."

"I have to drive soon and can't drink, so I took the Coke."

"Huh? What kind of cola is this?" Mai Xiaomiao looked at the glass bottle that looked like Coca-Cola, but with white Chinese characters on it: "Tianfu Cola?"

"Yes, it's Tianfu Cola." Zhou Zhi was very proud: "It was recently served at a state banquet."

"Is this the Tianfu Cola that Sister Xiaojuan is using to target Pepsi?"

"Yes! That's it!" Zhou Zhi nodded: "After more than a year of reorganization, production has finally started again!"

Tianfu Cola is a Chongqing beverage brand, produced by Chongqing Beverage Factory and jointly developed by Sichuan Provincial Institute of Traditional Chinese Medicine.

The predecessor of Chongqing Beverage Factory was Meihua Soda Factory, a time-honored brand established in 1936 that mainly produced Bluebird Soda.

In 1980, the Tianfu Cola formula, which was made of natural Chinese medicinal ingredients, was born. In 1981, the Tianfu Cola brand was launched and quickly became a famous specialty in Sichuan and Chongqing.

Tianfu Cola is made entirely of natural Chinese medicinal ingredients and does not contain any hormones. In 1985, the then national leader visited Chongqing and praised "China's own cola" after drinking it. After returning to Beijing, the General Administration of Institutional Affairs strictly inspected Tianfu Cola and designated it as a state banquet beverage, which was hailed as "a famous drink of the generation."

In 1988, it was renamed China Tianfu Cola Group Corporation, with 108 affiliated bottling plants, a 75% market share in China's cola market, an output value of more than 3 million yuan, and profits and taxes of more than 6000 million yuan.

In 1990, a bottling plant was established in Moscow, and Kazama Co., Ltd. took the initiative to act as an agent and set up a company in the World Trade Center in the United States to sell Tianfu Cola. Chinese-made cola entered the US market, the motherland of cola-type beverages, in one fell swoop.

However, in 1994, China was in the midst of a joint venture boom, attracting foreign investment at an unprecedented rate with exceptionally favorable conditions. In the trend of attracting investment, PepsiCo approached Tianfu Cola Group, and the two parties decided to jointly establish the "Chongqing PepsiCo Tianfu Beverage Company". PepsiCo invested US$1070 million, and Tianfu invested all of its high-quality assets, including factories, equipment, technology and brands, at a discount of US$730 million, in the joint venture.

If the joint venture was established according to this ratio, Tianfu Cola would inevitably go down the path of "disappearance" in later generations.

Later, through this joint venture, PepsiCo made use of Tianfu Cola's affiliated factories and sales network channels across the country to carry out rapid and low-cost layout in China.

At the same time, PepsiCo relied on its 60% stake and did not implement the requirement put forward by Tianfu Cola Group, that is, the Tianfu Cola series beverages produced by the joint venture should not be less than 50% of the total beverage output, and reduced the production of Tianfu Cola year by year.

The most exaggerated thing is that before the joint venture, Tianfu Cola Group, which originally had annual profits and taxes of tens of millions of yuan, suffered a net loss of 1280 million in the year of the joint venture. Subsequently, the original debt, including principal and interest, gradually accumulated to more than 1 million yuan.

By 2005, the joint venture's Tianfu Cola beverages accounted for only 1% of the company's total output. At the same time, the company's accumulated losses reached 7000 million yuan, and the Chinese side did not receive any profit. It also became a particularly distressed enterprise. Finally, in 2006, all shares were sold, and PepsiCo eventually held 94.4% of the shares.

However, in this life, things have changed because of the intervention of Zhou Liuniang Group.

The reason lies in the equity structure of Tianfu Cola Group. Before the restructuring, Yuzhou Beverage Factory was a state-owned enterprise wholly owned by Yuzhou Light Industry Group.

After acquiring the Fuling Pickle Factory, Zhou Liuniang Group created a new brand "Wushan Pickle". By using its own sales network and aluminum bag packaging, it reduced the salt content of the pickle and increased the sweetness, making the taste more suitable for modern people. The sales volume is very good.

Fuling and Yuzhou are two adjacent cities. Of course, Yuzhou is also aware of what Zhou Liuniang Group has done in Fuling.

In order to borrow Zhou Liuniang Group's sales network, Yuzhou Light Textile Group approached the Municipal Party Committee and proposed a joint venture.

Finally, both parties agreed to cooperate. Zhou Liuniang Group invested 20 million yuan in exchange for 20% of the shares of Tianfu Cola Group and shared its logistics and channels with Tianfu Cola Group.

Therefore, when PepsiCo proposed to establish a joint venture with Tianfu Group, Zhou Liumao Group, as an important shareholder and partner of Tianfu Cola Group, raised objections.

The objections mainly focus on two points. The first is that Zhou Liuniang Group's shares in Tianfu Cola Group will be diluted. In order to protect the interests of the group, Zhou Liuniang Group requires capital injection like PepsiCo, with the aim of ensuring the controlling rights of Zhou Liuniang Group and Tianfu Cola Group.

PepsiCo holds a 40% stake and is the largest shareholder, while Zhou Liuniang Group and Tianfu Cola Group each hold 30%. This brings the Chinese side's combined shares to 60%, ensuring China's absolute control over the brand.

The second point is that Zhou Liu Niang Group has absolute control over logistics and channels, as it has in the past and will in the future.

The joint venture that PepsiCo wants to establish is for the cola production line, as well as Tianfu Cola's self-operated bottling plants and sales channels in various locations. However, Zhou Liu Niang's logistics channels, sales channels and store resources are Zhou Liu Niang Group's own assets, and this joint venture will not be a reason for PepsiCo Group to share them.

Pepsi was of course not happy about this, and the parties were caught in a long-lasting dispute.

The key point is that many local officials now still stand on the side of foreign-funded enterprises and want to promote this joint venture case.

However, Zhou Liuniang Group quickly found a response strategy. Since Pepsi is a foreign-funded company, it can enjoy various preferential treatments. So if we find another foreign-funded company and offer better conditions, can it replace Pepsi?

This foreign investment comes from AXA Investment.

Yes, although AXA is operated by Li Laosan, its registered place is in the Cayman Islands, which is a pure foreign-funded enterprise.

What the local government wants is the political achievement of attracting foreign investment and the preferential treatment given by the state to joint ventures. Now, whether Pepsi is there or not, these preferential treatments and political achievements can still be obtained, and Pepsi's advantages are immediately offset.

Next, we just have to negotiate the terms honestly.

Pepsi's true intentions were gradually exposed during the negotiations. Especially in the situation where "two families asked for favors from one family", the local attitude towards Pepsi finally changed from being cautious for fear of angering foreign capital to being quite disgusted.

The proposal put forward by AXA is to fully fund the restructuring of Tianfu Cola Group, support Tianfu Cola's advertising investment and sales expansion across the country, and authorize Zhou Liuniang Group to execute its own decisions in the group, without directly interfering in the group's decisions.

PepsiCo's plan was to gain absolute control. Although it verbally promised that the Tianfu Cola series of beverages would not be less than 50% of the total beverage output, when Tianfu Cola Group was reminded by Zhou Liuniang Group and asked to implement this promise in the merger and acquisition contract, PepsiCo firmly refused to sign it.

The clay man was still a little angry, and this move eventually angered the local authorities. After reporting to the superiors and getting approval, they directly "kicked Pepsi out". (End of this chapter)