Around noon on June 20, Yili Group, a state-owned giant of the dairy industry in China posted an article on its public Wechat account, accusing its competitor Mengniu Dairy of disrupting the sponsorship market for the 2020 Beijing Olympics.
This is yet another example of fierce rivalry between two giant firms competing in the same industry after Gree and AUX air conditioner fell out.
The article is written with a very harsh tone, and is titled, “The Organizing Committee of the Beijing Winter Olympics can do nothing. The biggest scandal in the history of the Olympics! Mengniu Dairy is aligning with US companies to disrupt the Winter Olympics.”
Mengniu Dairy failed in the open bidding of the Beijing Winter Olympics, however, it used the capital cooperation between the state-owned COFCO Group (the largest shareholder of Mengniu, full name China National Cereals, Oils and Foodstuffs Corporation) and Coca-Cola in the United States to assist the latter in its Winter Olympics sponsorship. It then grabbed the chance to fall into the “Beverage” category of the global ‘joint’ partners of the 2020 International Olympic Committee.
Some say Yili is just playing the patriotic card to sabotage its competitor. The news went onto social media platform Weibo’s top search list, and was soon deleted. A top comment concluded, “Mengniu failed in the bid, however, managed to become a Winter Olympics sponsoring partner reliant on its partnership with Coca-Cola. Yili felt that the money they spent was in vain, so Yili accused Mengniu as a disturbance to Winter Olympics.” A top comment concluded.
According to Yili, Mengniu will jointly announce the news with the International Olympic Committee in Lausanne, the headquarters of the International Olympic Committee in Switzerland on June 23. As of now, Mengniu has not disclosed any information related to this matter.
Immediately after the article was published, it caused an uproar on the Internet and stock prices of both companies. As of 15:00, Yili (600887.SH) shares closed at 32.62 yuan, up 2.74%. Mengniu (2319.HK) shares fell by 0.33% to HK$30.50.
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