Jinjia Investments Co (金加投资公司), the board of which consisted of two Danone representatives, and Francis Leung Pak-to (梁伯韬) from Peregrine. In April 1998, just before the news of Peregrine's collapse broke, Leung was replaced on the board by a third representative from Danone. Although a transfer of shares in the WHH companies would have required State approval under the rules in force at the time for protecting state assets, the shares in Jinjia were not covered. When Peregrine collapsed, and transferred its Jinjia shares, Groupe Danone became majority owner. Zong has alleged that this transfer of ownership was a bad-faith takeover by stealth. Scope of joint venture On 28 March 1996, five joint venture companies were formed: Hangzhou Wahaha Baili Foods 杭州娃哈哈百立食品有限公司 Hangzhou Wahaha Health Foods Co 杭州娃哈哈保健食品有限公司 Hangzhou Wahaha Foods Co 杭州娃哈哈食品有限公司 Hangzhou Wahaha Beverages Co 杭州娃哈哈饮料有限公司 Hangzhou Wahaha Quick Frozen Foods 杭州娃哈哈速冻食品有限公司 The business had grown into 39 joint venture entities by 2007, and the total injected capital amounts to US$131 million. In 2006, the turnover of the joint ventures contributed €100 million to the top line of Danone, and in excess of 5% of Danone's total net profit. Non-joint venture companies When the joint venture agreement was inked, five other WHH companies remained outside the scope of the joint venture. At the end of 2006, total non-joint venture companies reportedly had equity of ¥5.6 billion and profits of ¥1.04 billion. In December, Zong had agreed to sell these to Danone for ¥4 billion. The Hangzhou Wahaha Guangsheng Investment Co. (杭州娃哈哈广盛投资有限公司) ("GUANGSHENG") established in 2003 with registered capital of ¥50 million, is a key non-JV entity. Its shares were held by Zong and the union in a ratio of 60:40. Its capital was later increased to ¥80 million. The following companies were its subsidiaries or associates, with holdings ranging from 39 to 60 percent : Hangzhou Wahaha Children's Clothing Co. 杭州娃哈哈童装有限公司, est. 2002 Changsha Wahaha Beverages Co. 长沙娃哈哈饮料有限公司 Harbin Shuangcheng Wahaha Foods Co. 哈尔滨双城娃哈哈食品有限公司 Jian Wahaha Beverages Co. 吉安娃哈哈饮料公司 The shares of Hangzhou Wahaha Children's Clothing Co. (杭州娃哈哈童装有限公司) founded in 2002, were initially held by Guangsheng, but were transferred out in August 2003, in an "interesting series of share transfers". It is now 65% owned by Zong, 10% by his wife, and 25% by Platinum Net Ltd. The Hangzhou Wahaha Food and Beverage Sales Co. (杭州娃哈哈食品饮料营销有限公司) "WHHFBSC", registered on 19 December 2006, is an external company allegedly now