By staff reporter Zhao Hejuan

(Caijing.com.cn) Huiyuan Juice Group Ltd. (HK 01886) is adjusting to life without Coca-Cola Co. After the Ministry of Commerce rejected Coke’s bid for the Chinese juice maker, Huiyuan has given plans to move up the supply chain and is once again pouring effort into its juice business, according to a senior executive from the company.

The executive, who’s close to Huiyuan Chairman Zhu Xinli, said the company’s immediate response to the failed US$ 2.4 billion takeover was to increase marketing of its juice concentrate products. This could put Huiyuan, whose core business is pure juice, in more direct competition with Taiwan’s Uni-President and even Coca-Cola’s Minute Maid juice brand.

Meanwhile, Huiyuan is backtracking from previous plans to invest in upstream business such as fruit production and packaging, said the executive. This strategy envisioned Huiyuan as Coca-Cola’s supplier once its juice business had been sold off. But the deal’s failure has curtailed those ambitions.

Shanghai Securities analyst Teng Wenfei said the failed sale will require Huiyuan to reverse in strategic focus, after it spent the last few months gearing up to service Coke’s demand.

Huiyuan has poured more than 2 billion yuan of upstream investments when it still expected a windfall from the sale to Coke. Some of these projects have been cancelled, but others were too far along, the executive said, leaving Huiyuan holding the bill.

Coca-Cola has said in response to the Ministry of Commerce’s March 18 ruling that it will not try to negotiate a new deal with Huiyuan. Instead, the American beverage giant will “focus all of our energies and expertise on growing our existing brand…including in the juice segment.”

It’s unclear whether Huiyuan will still be able to capitalize on Coke’s juice business as an outside supplier. Without a privileged position, Huiyuan will be subject to arms-length treatment and competitive bids.

Full article in Chinese: http://www.caijing.com.cn/2009-03-24/110127562.html