Joint Venture between Grameen Bank & Danaone

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Grameen Bank and Danone profile:

Grameen Bank, around which the companies making up the Grameen Group have been created, serves millions of poor borrowers with microcredit. Grameen Bank (GB) has reversed conventional banking practice by removing the need for collateral and created a banking system based on mutual trust, accountability, participation and creativity. GB provides credit to the poorest of the poor in rural Bangladesh, without any collateral. As of May, 2006, it has 6.67 million borrowers, 97 percent of whom are women. With 2247 branches, GB provides services in 72,096 villages, covering more than 86 percent of the total villages in Bangladesh.

source: http://www.grameen-info.org/bank/index.html

With around 16 billion USD of total sales in 2005, Groupe Danone is the world leader in fresh dairy products and bottled water and joint world leader in the biscuits market. 50% of Groupe Danone's 90,000 employees work in Asia Pacific and Danone operates around 100 factories in this part of the world.

source: http://www.danone.com/wps/portal/jump/DanoneCorporateIntl.Press.Commun2004PressReleases?ref=CMS.DanoneCorporateIntl.Press.2006PressReleases.Trimestre1.CP_160306

Business Strategy:

The Grameen Group and Groupe Danone entered into a joint venture agreement effective from March 2006, to form a company called Grameen Danone Foods - a social business enterprise in Bangladesh. A unique initiative joining Danone, the world's leading company for healthy food products and Grameen Group, created by the founder of Grameen Bank, Professor Muhammad Yunus, Grameen Danone Foods will bring daily healthy nutrition to low income nutritionally deprived populations in Bangladesh and alleviate poverty through the implementation of a unique community based business model.

Leveraging on the respective strengths of its founding partners, the Grameen Danone Foods model will rely on the creation of independent business and job opportunities in the farming, processing and sales and distribution sectors. To ensure the sustainability of the initiative, special emphasis will be put on providing appropriate micro-financing solutions together with adequate professional training to the members of the local communities that will engage business with the project.

The initial focus of Grameen Danone will be to launch an easily affordable dairy product to fulfill the nutritional needs of children in Bangladesh and contribute to their strong growth by bringing them the benefits of milk and micronutrients that they lack, including vitamins and minerals such as Iron, Zinc, and Calcium.

In order to maximize the social impact, Grameen and Danone are developing low capital intensity manufacturing options and intend to reinvest the profits of Grameen Danone Foods beyond its cost of capital, in the expansion of this model throughout the country. A first factory will be built in Bogra, 230 kms north of Dhaka, and is expected to start operations by end 2006 with a plan of setting up 50 plants within the next 10 years. Several hundred livestock-farming and distribution jobs would be created in the local community as a result of this first implementation.

source: http://www.grameen-info.org/dialogue/dialogue63/regularfl2.html
http://www.gainhealth.org/gain/ch/en-en/file.cfm/grameen-danone-14th.pdf?contentID=1579.

Integration Challengers: culture diferences/sinergies/organizational issues:

Grameen ...