Danone

• 1. Introduction

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  The French food company Danone is named after a small boy. In 1919, in Barcelona, a physician named Isaac Carasso began producing traditional yoghurt. He gave the brand a name that translates to little Daniel, honouring his son Daniel Carasso.

  Today the business is run from Paris, trades on Euronext Paris, and sits in the CAC 40 stock market index. In 2018 it sold products in 120 markets and reported sales of 24.65 billion euros. In the first half of that year, 52% of sales came from dairy and plant-based products such as yoghurt. Specialised nutritional preparations supplied 29%, and branded bottled water supplied the remaining 19%.

  How does a family yoghurt business grow into a group that sells baby formula and bottled water on several continents? Why did it once own glassworks, a brewer and a string of biscuit brands? And what happens when a company built on the language of health is accused of selling too aggressively?

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• 2. Little Daniel Abroad

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  Isaac Carasso was born İzak Karasu in Thessaloniki, in the Ottoman Empire. He was a Sephardic Jewish physician, and his yoghurt began in Spain. The business did not stay there long. In 1929 he moved the company to France and opened a plant in Paris.

  The next move crossed an ocean. In 1942 his son Daniel took the company to New York. There he worked with Juan Metzger, a Swiss-born Spaniard. Daniel changed the brand name to Dannon, a version meant to sound more American.

  Daniel went home in 1951 to manage the family's businesses in France and Spain. The American arm was sold to Beatrice Foods in 1959. Danone bought it back in 1981.

  To this day, some of the company's products in the United States are sold under the Dannon label.

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• 3. Glass, Beer and Biscuits

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  In 1967 Danone merged with Gervais, the leading fresh cheese producer in France, and became Gervais Danone. The more surprising partner was a glass maker. Boussois-Souchon-Neuvesel, known as BSN, had been formed when Glaces de Boussois joined the Lyon-based firm Verreries Souchon-Neuvesel. Glaces de Boussois was France's second-largest producer of flat glass, used for windows in buildings and cars. Souchon-Neuvesel was the country's top maker of bottles and jars.

  In 1970, three years before the big merger, BSN absorbed Evian, Kronenbourg, Société Européenne de Brasseries and Blédina. The logic was vertical integration. The Alsatian brewer Kronenbourg and the Evian water brand were the glassmaker's largest customers. Owning them gave its bottles something to hold.

  In 1973 BSN and Gervais Danone merged, and the group began to expand abroad. One early test was an advertising campaign in Soviet Georgia, which began in October 1976 and succeeded. By 1979 the group had walked away from glassmaking by disposing of Verreries Boussois. It sold 56% of its glass-containers business in 1999 and the remaining 44% in 2003.

  The name on the door kept changing. The company became Groupe Danone in 1983. In 1994 BSN itself took that name, adopting the title of the group's best-known international brand. In 2009 the word Groupe was dropped and the company became simply Danone.

  In 1987 Gervais Danone bought the European biscuit maker Générale Biscuit, owner of the LU brand. Two years later it bought the European biscuit operations of Nabisco. These included the British makers Huntley and Palmers, Peek Frean and Jacob's, which had earlier merged as Associated Biscuits Ltd.

  Franck Riboud became chairman and chief executive in 1996, succeeding his father Antoine, who retired. He kept the group focused on three product groups: dairy, beverages and cereals. He sold off activities that no longer fit, including the brands Amora, Liebig and Maille.

  Kronenbourg and the 1664 brand went to Scottish & Newcastle in 2000 for 1.7 billion pounds, along with most of the European beer business. The Italian cheese and meat businesses of Egidio Galbani were sold in March 2002, and so were the beer operations in China. In September 2004 the British and Irish biscuit operations, under the Jacob's name, went to United Biscuits. Sauces followed. HP Foods in the United Kingdom and United States was sold in August 2005, and Amoy Food in Asia went to Ajinomoto in January 2006.

  In July 2007 Danone agreed to sell most of its biscuit division, including LU and Prince, to Kraft Foods for around 5.3 billion euros. The Latin American unit Bagley and India's Britannia Industries were left out of the sale. The same month, both boards agreed a 12.3 billion euro cash offer for Numico, a Dutch baby food and clinical nutrition company. The deal made Danone the world's second-largest maker of baby food.

  By 2018 the shelf looked very different. International brands included Activia, Actimel, Alpro, Evian and Volvic. Oikos was sold as GetPro in the United Kingdom and HiPro in Italy and France. Local names ranged from Blédina in France to Bonafont in Mexico and Brazil and Mizone in China and Indonesia. The list even reached Iran, where the regional brand is Damavand.

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• 4. The Wahaha Feud

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  Danone has invested in China since 1987, when it formed a joint venture with Fengxing Milk in Guangzhou. China is now one of its top five markets. The largest partnership of all began in 1996, when Danone and the Hangzhou Wahaha Group, the biggest beverage producer in China, launched a dairy venture. Danone held 51% of it. Forbes magazine called it a showcase joint venture.

  By 2005 Danone had noticed a problem. Alongside the 39 structures of the venture, 60 factories and distribution companies were making and selling beverages illegally under the Wahaha name. Danone tried several times to take a stake in those outside companies. Wahaha's general manager, Zong Qinghou, rebuffed it.

  In December 2006 Zong signed a deal letting Danone buy a majority stake in the operations outside the venture. He then had second thoughts and reneged, saying the offer was underpriced and holding out for more. The quarrel turned into a trademark dispute. Danone filed for arbitration in Stockholm on the 9th of May 2007. On the 4th of June it sued in Los Angeles Superior Court, naming Ever Maple Trading and Hangzhou Hongsheng Beverage. Zong, his wife and his daughter controlled both companies.

  The two sides reached an agreement in 2009. Danone left the venture and sold its 51% back to its former Chinese partner.

  Other Chinese bets had their own arcs. Danone bought 5% of Bright Dairy in 2001, doubled that in March 2005, and reached 20% in April 2006, making it the third-largest shareholder. In October 2007 the parties announced that Danone would sell the stake to the other two main shareholders at a small profit.

  On the 20th of May 2013 Danone announced a 4.0% investment in Mengniu, the top dairy company in China. It was arranged through COFCO, the state-owned food company that is Mengniu's majority shareholder. Danone later raised its interest to 9.9%, and by 2016 it was Mengniu's second-largest shareholder. A joint venture to grow fresh dairy was created the same month.

  On the 31st of October 2014, Danone, Mengniu and Yashili announced that Danone would join a private placement by Yashili. It totalled 437 million euros at 3.70 Hong Kong dollars per share. Afterwards Mengniu held 51.0% of Yashili and Danone held 25.0%.

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• 5. Russia and Emerging Markets

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  Emerging markets account for over 50% of Danone's sales, and joint ventures are one of its favoured tools there. Al Safi in Saudi Arabia came in 2001, Yakult in India in 2005 and in Vietnam in 2006, and Alquería in Colombia in 2007. In March 1996 Danone had agreed to buy 20 percent of the Strauss Group, Israel's second-largest food manufacturer.

  On the 18th of June 2010 Danone partnered with Unimilk, one of Russia's main milk producers. The two merged their fresh dairy activities across Russia, Ukraine, Kazakhstan and Belarus. Unimilk held 21% of the Russian market, ran 28 facilities and had sales of 969 million euros in 2009. Danone was to hold 57.5 percent of the capital and funded the deal by writing put options for Unimilk's shareholders. The combined company employed 18,000 people in the Commonwealth of Independent States, and Russia became one of Danone's five most important markets.

  In 2012 Danone entered India by acquiring the nutrition business of the Wockhardt Group. Danone India sells products for pregnancy, infancy, early childhood and adulthood. Its brands include Aptamil, Neocate, Farex, Protinex, Dexolac and Nusobee, and it is headquartered in Mumbai. In 2018 it dropped some dairy products to sharpen its focus on nutrition.

  Africa brought older ties. In June 2012 Danone raised its stake in Centrale Laitière, the dairy leader in Morocco, to 67.0%. The two companies had worked together since 1953, which made Centrale Laitière Danone's first franchise. In October 2013 Danone and Abraaj Group acquired FanMilk International, a frozen dairy and juice maker in Ghana, Togo, Nigeria, Burkina Faso, Benin and Ivory Coast. In July 2014 Danone took a 40% interest in Brookside, East Africa's leading dairy group, in Kenya.

  By October 2022, after the invasion of Ukraine, Danone had begun transferring its Russian segment to new owners. Russia then provided about 5% of total revenue. The company weighed about two dozen possible applicants, but by July 2023 no successor had been chosen. Meanwhile Activia was renamed Aktibio in the Russian market, a change Danone said would allow renewed investment in Russian dairy.

  In July 2023 the Russian government seized the shares in Danone Russia and placed them under the Federal Agency for State Property Management. On the 18th of July, Ibragim Zakriev, Chechnya's Minister of Agriculture and a nephew of Ramzan Kadyrov, was named general director. By the 26th of July, Danone had set aside 700 million euros for the loss of its Russian business, plus 500 million euros for exchange losses after the fall of the ruble.

  In February 2024 it was rumoured that Kadyrov or another nephew, Yakub Zakriev, would take over the unit for under 200 million dollars. On the 13th of March, Vladimir Putin decreed an end to the temporary management order, which opened the way for a sale.

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• 6. Business With a Conscience

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  On the 25th of October 1972, Antoine Riboud gave a speech in Marseilles that still shapes Danone's thinking. He argued that growth should not happen without corporate social responsibility. He was the first CEO to say publicly that a company's human and environmental sides should be taken into account. These ideas became the base of what Danone calls its dual project, economic and social.

  In November 2005 Franck Riboud met Muhammad Yunus, founder of the Grameen Bank and winner of the 2006 Nobel Peace Prize. They talked at length about developing poor countries and found their expertise complementary. In 2006 the bank and Danone formed Grameen Danone Foods, a social business in Bangladesh.

  Its yoghurt, Shokti Doi, contains protein, vitamins, iron, calcium, zinc and other micronutrients meant to fill nutritional gaps in Bangladeshi children. It sells for six euro cents, a price that studies found affordable for the poorest families. Profits are reinvested in running and expanding the business.

  Funds followed the philosophy. The fund danone.communities began in 2007 to finance social business. The Danone Ecosystem Fund arrived in 2009 to support partners such as farmers, subcontractors and vendors. Livelihoods began in 2011 to finance environmental projects, from peasant agriculture to deforestation. In return it offers investors carbon credits.

  Science got its own channel. Danone set up its first Institute in Paris in 1991 and launched it officially as a private nonprofit in 1997. By 2007 there were 18 institutes around the world, and in 2004 they were gathered under Danone Institute International. Together they have funded more than 900 research projects, with a global budget of 16 million euros. The international body counts more than 220 scientific experts.

  In 1997 the institute created the Danone International Prize for Nutrition, worth 120,000 euros and awarded every two years. The 2007 prize went to Jeffrey M. Friedman of Rockefeller University for work on leptin, a hormone he discovered. More than 650 applicants had competed. The 2011 winner, Jeffery I. Gordon, was honoured for work on the human gut microbiome. Half of the jury comes from Danone's own institutes, and the winner is chosen by secret vote. The prize was renamed the Danone International Prize for Alimentation in 2018.

  Yoghurt itself got a conference. In 2012 the institute and the American Society for Nutrition formed a working group on the health effects of yogurt. The first global summit followed in Boston in 2013, and summits have been held every year since. A related Yogurt in Nutrition Award, worth 30,000 US dollars, funds research for two years.

  Danone has set a target to cut methane emissions from fresh milk by 30% by 2030, partly by growing its plant milk range. Environmental researchers have criticised it for overstating progress and leaning too heavily on greenhouse gas removal. In 2020 it also pledged that all its eggs would come from cage-free suppliers by 2025.

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• 7. Control of the Company

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  In mid-July 2005 Danone's share price rose 20% within two weeks on rumours of a bid from PepsiCo. The rumours were denied. Danone's narrow focus and modest size had made it an attractive target for rivals such as Nestlé and Kraft Foods. The "economically patriotic" French government responded by drafting a law to protect companies in strategic industries from takeover. It became known as the Danone Law.

  Speculation returned in mid-2006, when PepsiCo declared its wish to grow significantly in France through a sizeable, non-hostile acquisition. The French daily Le Figaro reported that Kraft had not ruled out an acquisition there either. The stock market apparently marked down the chance of a PepsiCo bid after the Numico deal.

  Ownership is now spread across the world. American investors hold 43% of Danone, French investors 19%, British investors 10%, Swiss investors 6%, German investors 5% and the rest of Europe 17%. The head office has stood in the 9th arrondissement of Paris since 2002. In April 2018 the board had 16 members.

  On the 1st of October 2014, Franck Riboud stepped down as CEO and was succeeded by Emmanuel Faber. In 2017 Riboud became honorary chairman, while Faber took the chairmanship as well as keeping his CEO post. That year Danone acquired WhiteWave Foods, owner of Alpro. The resulting subsidiary, DanoneWave, was renamed Danone North America in 2018.

  Cost cutting recurred. In mid-February 2013 Danone said it would cut 900 jobs, about 3.3 percent of its 27,000 European workers. In 2020 it announced cuts of up to 2,000 jobs, about 2% of its workforce, as part of a reorganisation.

  In late 2020 the London-based hedge fund Bluebell Capital became a shareholder and put Faber's position in doubt. A letter to shareholders in November 2020 called the stock market performance under Faber "disappointing". It argued that "the right balance between shareholder value creation and sustainability issues" had not been struck. After only slightly comforting 2020 results and weak first-quarter turnover, Faber was ousted in mid-March 2021.

  On the 16th of May 2021, Danone announced that Antoine Bernard de Saint-Affrique would be the next CEO, effective from the 15th of September.

  In May 2025 Danone announced a majority stake in Kate Farms, an American company specialising in medical nutrition, for an undisclosed amount.

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• 8. Under Scrutiny

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  In 2008 Skeletons, a Danone yoghurt marketed to Russian children, was removed from sale. Parents had complained that its skeleton characters caused psychological trauma.

  In the 2010s, reports indicated that Danone engaged in unethical marketing of infant formula in China, Indonesia, Turkey and India. India passed a law on infant milk substitutes in 1992 and strengthened it in 2003. It bans advertising formula for children aged 0-2 and bans payments to doctors who recommend it. Danone's Nutricia India ordered an external audit of payments from March through August 2013 and found none to doctors. Critics said the company directed the audit and timed it nearly a year after the purchase, missing the crucial handover period. A policy director for Baby Milk Action said Nutricia "seems to be using the audit as a cover".

  In October 2012 Save the Children interviewed 60 mothers of infants aged 0-6 months in each of six Chinese cities. They were Hohhot, Beijing, Jinan, Shanghai, Nanjing and Shenzhen. Some 40% of the mothers said they had received formula samples. Of those, 60% came from company representatives and more than a third from healthcare workers. Dumex, a Danone brand at the time, was the supplier named most often.

  In February 2013 The Guardian reported that until 2011 the Danone subsidiary Sari Husada in Indonesia had midwives sign contracts for payments tied to selling set numbers of boxes of formula. Danone said this had ended and been replaced by a training scheme. Yet the main change appeared to be a switch from cash to goods such as televisions, laptops and medical equipment. Danone commented: "That may still be happening, that's something we need to address." An Indonesian paediatrician told the paper: "Selling formula is like the killing fields, in my opinion. The babies will die of diarrhoea and they will die of malnutrition."

  In June 2013 Danone was accused in Turkey of misleading mothers with a campaign suggesting they might not produce enough breast milk. The campaign urged them to use its powdered milk to fill any shortfall. Danone said it based its advice on WHO guidance and claimed that the WHO and UNICEF endorsed the campaign. The WHO said Danone lacked permission to use its logo and gave it 14 days to remove its name. Ayman Abulaban, the UNICEF representative for Turkey, said his office had not endorsed the campaign.

  On the 2nd of August 2013, the New Zealand government and Fonterra warned that ingredient batches supplied to four Danone plants in Asia-Pacific might carry Clostridium botulinum bacteria. Danone recalled selected infant formula in eight markets: New Zealand, Singapore, Malaysia, China, Hong Kong, Vietnam, Cambodia and Thailand. On the 28th of August, New Zealand's Ministry for Primary Industries concluded after weeks of tests that none of the batches contained the bacteria. On the 8th of January 2014, Danone ended its supply contract with Fonterra. It later won damages of 105 million euros.

  In 2019 the Spanish regulator Comisión Nacional de los Mercados y la Competencia fined Danone 929,644 euros. The charge was forming a cartel with other dairy companies to avoid competing when buying milk from Spanish farmers between 2000 and 2013. In February 2024 the Spanish Audiencia Nacional annulled the fine because the statute of limitations had passed.

  A 2024 study in Science Advances found that Danone was responsible for 3% of global branded plastic pollution by count, the 4th highest share. In October 2025 West Java Governor Dedi Mulyadi made a surprise inspection of the Aqua facility in Subang Regency. Aqua is Danone's bottled water brand in Indonesia, advertised as mountain spring water. The inspection revealed that it draws its water from drilled groundwater wells. The news went viral and drew widespread disapproval online, and Danone replied that Aqua water is safe to drink.

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