Danone minimises reported Evian health alert

30th May 2007, Comments 0 comments

PARIS, May 30, 2007 (AFP) - French food group Danone sought on Wednesday to minimise a potential sales problem in China, where authorities are reported to have found high levels of bacteria in Evian mineral water, the company's star product.

PARIS, May 30, 2007 (AFP) - French food group Danone sought on Wednesday to minimise a potential sales problem in China, where authorities are reported to have found high levels of bacteria in Evian mineral water, the company's star product.

"China has regulations that are different from those applied internationally and in Europe, notably for the level of bacteria," a Danone spokesman told AFP.

Chinese customs authorities have detected an abnormally high level of bacteria in a number of Evian bottles, representing a total of 118,000 liters according to Danone, the Chinese newspaper Information Times reported on Tuesday.

It was the second such incident, as high levels of bacteria were also found in Evian water in September, according to the report.

Evian is a luxury item in China and is much favored by foreigners in hotels and restaurants.

Several brokerage houses have drawn a link between the reported detection of bacteria in Evian and a dispute -- now several months old -- between Danone and its Chinese partner Wahaha.

Danone has taken legal action against Wahaha and analysts here have accused Chinese authorities of using the Evian issue as a means of pressuring the French group.

"These accusations (against Evian) are not unrelated to the conflict between Danone and its Chinese partner," said analysts at Natexis Bleichroeder.

"Chinese authorities generally try to discredit consumer goods produced by foreign parties, which are often leaders on the Chinese market," Natexis Bleichroeder said, noting that Nestle and Procter and Gamble have faced similar accusations.

Danone shares had fallen 1.35 percent to 115.07 euros in mid-morning trading in Paris, where the overall market was 1.01 percent weaker.


Copyright AFP

Subject: French news

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