---
title: "Will Red Bull Disappear?"
description: "The Red Bull that sells billions of cans annually and helps you stay alert is being replaced by new brands due to the legal dispute between Huabin Group and Thai Tiansi. On June 23, Huabin's 'War Horse' brand finally obtained the 'Blue Hat' certification, joining the functional beverage war. Ten days earlier, on June 13, Thai Tiansi's Red Bull Anji was officially launched, starting to capture market share from South China. These seemingly unrelated brands are actually derivatives of the dual-brand attacks between Huabin Group and Thai Tiansi."
author: "徐硕"
publisher: "New Distribution"
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published: "2019-07-05"
language: "en"
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---

# Will Red Bull Disappear?

> The Red Bull that sells billions of cans annually and helps you stay alert is being replaced by new brands due to the legal dispute between Huabin Group and Thai Tiansi. On June 23, Huabin's 'War Horse' brand finally obtained the 'Blue Hat' certification, joining the functional beverage war. Ten days earlier, on June 13, Thai Tiansi's Red Bull Anji was officially launched, starting to capture market share from South China. These seemingly unrelated brands are actually derivatives of the dual-brand attacks between Huabin Group and Thai Tiansi.

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**The Red Bull that sells billions of cans annually and helps you stay alert is being replaced by new brands due to the legal dispute between Huabin and Tiansi.**
On June 23, the "**War Horse**" brand under Huabin Group finally obtained the "Blue Hat" certification, officially joining the functional beverage battle.
Ten days earlier, on June 13, Red Bull **Anji** launched by Thai Tiansi Group was officially released, starting to capture market share from the South China region.
These seemingly unrelated brands are **actually derivatives of the dual-brand attacks between Huabin Group and Thai Tiansi.** Tracing back to the source, the conflict originated with "China Red Bull." Neither Yan Bin, Chairman of Huabin Group, nor Xu Xinxiong, the new director of Thai Tiansi Group, wants this 50-billion-yuan brand asset to fall into the other's hands.
Image source | IC photo
Since the death of Red Bull founder and former chairman of Thai Tiansi, Xu Shubiao, Yan Bin and his China Red Bull (Red Bull Vitamin Beverage Co., Ltd.) have been embroiled in a series of lawsuits, fiercely contesting in various legal battles, sometimes as defendant, sometimes as plaintiff, **disputing with the entire Xu family over "China Red Bull" for nearly three years.**
**"China Red Bull" is also unwilling to give up.** In 2016, when the trademark for China Red Bull expired, Thai Tiansi wanted to stop renewing, but Huabin Group continued production and sales, which dissatisfied Thai Tiansi, leading them to directly launch a trademark protection war against Huabin Group, resulting in China Red Bull under Huabin Group no longer having the right to use the "Red Bull" trademark and subsequently ceasing related production. Although Yan Bin also fought back in the trademark war, from 2016, Red Bull's sales dropped from 23.07 billion yuan to 19.6 billion yuan, and its market share in functional beverages fell from 63% to 58%, only recovering in 2018.
Even if Thai Tiansi ultimately wins the "Red Bull" trademark rights, it still cannot produce on a large scale in mainland China because the production and sales rights for China Red Bull are tightly held by Huabin Group. **To legally produce "China Red Bull," all three elements are indispensable.**
"The lawsuits between the two sides are essentially about redistribution of interests. If both parties can reallocate interests reasonably, it would be a win-win for both," Zhu Danpeng, senior researcher at the China Food Brand Research Institute, told *China Entrepreneur*. But as it stands, **the probability of a win-win is very slim, and the likelihood of separation is relatively high.** **In other words, if Thai Tiansi and Huabin Group still harbor grudges, the disappearance of Red Bull might just be a matter of time.**
**The Choice of the "Mixed-Blood" Red Bull**
**The dispute between Huabin and Thai Tiansi was planted when the companies were registered in China and Thailand.** Red Bull founder and former chairman of Thai Tiansi, Xu Shubiao, had long wanted to bring Red Bull to the Chinese market. In 1993, Xu Shubiao established the first Red Bull factory in Hainan (Hainan Red Bull), but because functional beverages were not yet a category in China's product classification at that time, Red Bull failed to get government approval that year.
In 1995, through an introduction, Xu Shubiao met Yan Bin, Chairman of Huabin Group. Despite an age difference of nearly 30 years, they hit it off and soon reached a cooperation agreement. That same year, Red Bull Vitamin Beverage (Thailand) Co., Ltd. (referred to as Thailand Red Bull) and Red Bull Vitamin Company were established. The Xu family, sole controller of Thai Tiansi Group, and Yan Bin held 68% and 32% of Thailand Red Bull respectively.
Three years later, in September 1998, Red Bull Vitamin Company was re-registered in Beijing, which is now China Red Bull (Red Bull Vitamin Beverage Co., Ltd.). Its largest shareholder, Thailand Red Bull, held 88% of shares, with the Xu family's wholly-owned company, Inter Biopharmaceutical Holdings Co., Ltd., holding 7%, Yan Bin's wholly-owned company, Global Market Holdings Co., Ltd., holding 4%, and a township enterprise under Huairou District State-owned Assets Supervision and Administration Commission holding 1%. After cross-shareholding, the Xu family and Yan Bin held approximately 66.84% and 32.16% respectively.
When the joint venture (China Red Bull) was established in 1998, Thai Tiansi, as the founder and holder of the "Red Bull" trademark, authorized China Red Bull as the only company with the right to produce and sell Red Bull products in China through trademark licensing. Additionally, because Red Bull founder Xu Shubiao had a close relationship with Yan Bin, the Xu family entrusted Yan Bin with full operational responsibility for Red Bull's business in China and appointed him as Chairman of China Red Bull.
For the next 20 years, Yan Bin was one of Red Bull's most important business partners. **Red Bull founder Xu Shubiao provided technology and brand authorization to China Red Bull, while Yan Bin was responsible for production and sales in China.** In fact, the Xu family found an almost perfect Chinese partner. Under Yan Bin's efforts, Red Bull's sales in China grew increasingly well. **At its peak, Red Bull sold 6 billion cans a year, capturing half of China's functional beverage market.**
**But in business, interests are eternal.** In 2012, Red Bull founder Xu Shubiao passed away, and his son Xu Xinxiong took over Thai Tiansi Group. What dissatisfied Xu Xinxiong was that during the 20-year cooperation with Yan Bin and China Red Bull, Thai Tiansi only earned income through trademark licensing fees and raw material fees for flavors and fragrances from the joint venture. Before his father's death, no dividend claims were ever made against the joint venture (China Red Bull). For the substantial accumulated distributable profits of China Red Bull, Xu Xinxiong, as a director, claimed dividends and questioned why dividends had never been paid.
Subsequently, Thai Tiansi sent people to investigate. According to reports from *China Business News*, between 2007 and 2009, Yan Bin established sales companies outside the joint venture while closing the joint venture's branch offices. *China Entrepreneur* reporters found through Tianyancha that Beijing Red Bull Beverage Sales Co., Ltd., controlled by Huabin Investment, had 10 branch companies registered, while 17 branches of the joint venture (China Red Bull) under Red Bull Vitamin Beverage had all been deregistered, with most of Red Bull's sales operations transferred out of the joint venture. By 2015, Yan Bin and his Huabin Group had also established Red Bull Vitamin Co., Ltd. in Guangdong, Hubei, and Jiangsu to handle Red Bull production and sales.
But Xu Xinxiong was not Xu Shubiao. Seeing Yan Bin aggressively expanding China Red Bull's market share, he could not sit idly by. In 2016, the trademark license Thai Tiansi granted to China Red Bull expired, and they decided not to renew. However, China Red Bull and several enterprises under Huabin Group continued producing Red Bull beverages. To protect Thai Tiansi's rights, Xu Xinxiong sued Yan Bin and several Red Bull enterprises under Huabin Group for infringement of registered trademark rights and unfair competition, demanding they cease infringing activities. Since then, the litigation between the two sides has continued.
**The "mixed-blood" Red Bull, under the careful cultivation of its "Chinese father" Yan Bin, finally reached the top position in the Chinese market and was enjoying the joy of success, only to be slapped by its "Thai biological father" Xu Xinxiong, who claimed its identity was illegal.** But Yan Bin and China Red Bull were not resigned to fate and were determined to fight to the end against Xu Xinxiong's Thai Tiansi.
**The Era of Post-Dual Hegemony**
Regarding the trademark dispute between Thai Tiansi and China Red Bull and the impact of related judgments on both parties, *China Entrepreneur* contacted both sides, but as of press time, Thai Tiansi had not responded, and China Red Bull said it would not accept interviews for now.
Before the trademark war began in 2016, the Xu family, sole controller of Thai Tiansi, had conducted a series of negotiations with Yan Bin over issues such as dividends from China Red Bull. Initially, negotiations went smoothly. Yan Bin agreed to transfer all "Red Bull" trademarks and appearance patents registered by the joint venture and its subsidiaries to Thai Tiansi. In exchange, the Xu family increased Yan Bin's equity in Thailand Red Bull from 32% to 49%, and Yan Bin's stake in China Red Bull also rose to 47.12%.
However, according to *National Business Daily*, in Thailand Red Bull, although Yan Bin's Huabin Group is the largest legal-person shareholder with 27%, and Yan Bin's daughter Yan Danhua is the largest individual shareholder with 17.12%, among the board seats, except for Yan Bin, the other three are occupied by Xu family members. Relevant legal documents also show that the directors authorized to sign and bind the company are: Pavana Rasara (Xu Shubiao's wife) and Yan Bin or Xu Xinxiong, with the company seal affixed.
This means the Xu family has the right to make final decisions on behalf of Thailand Red Bull. In September 2016, the board of Thailand Red Bull resolved to remove Yan Bin, Yan Danhua, and others from their positions as directors of China Red Bull, and Yan Bin from his roles as Chairman of China Red Bull and legal representative of Thailand Red Bull. Although Yan Bin refused to hand over control, the legality of the resolution has been recognized by Thai courts.
**Being expelled from the board by the Xu family was something Yan Bin never imagined and could not accept.** In 2017, Yan Bin, in the name of China Red Bull, sued Thai Tiansi, arguing that the Red Bull trademarks and similar trademarks used by Red Bull beverages were part of China Red Bull's assets, and Thai Tiansi should transfer the relevant series of trademarks to China Red Bull. At the same time, in response to the trademark infringement lawsuit filed by the Xu family, Yan Bin counterattacked by filing a counterclaim of non-infringement and, based on "unjust enrichment," demanded the Xu family return the huge advertising expenses Huabin Group had invested in Red Bull.
Xu Xinxiong's Thai Tiansi was not to be outdone. In 2017, Thai Tiansi also sued China Red Bull's packaging supplier, ORG Technology, which had been a long-term partner for canning Red Bull beverages, providing over 60% of Red Bull canning production. Tiansi demanded that ORG immediately stop manufacturing products bearing the "Red Bull" and related graphic trademarks and compensate for economic losses.
**According to incomplete statistics, the number of lawsuits between Thai Tiansi and Huabin Group has exceeded 20.**
But with the arrival of a new time node, Yan Bin had to respond actively. According to public information, China Red Bull was officially registered on September 29, 1998, with a business term of twenty years, expiring on September 29, 2018. Therefore, on September 29, 2018, Yan Bin issued a statement through China Red Bull, stating that according to binding legal documents formed earlier by the joint venture parties, the business term of China Red Bull is fifty years.
"Although the business term registered with the industry and commerce authorities is twenty years, this was to meet the special requirements for foreign investment registration approval at the time of establishment and does not mean that the company's business term is only twenty years. The company has submitted an application for extension of the business term to the relevant authorities in accordance with legal procedures, and the extension is being processed," Yan Bin said in the official statement from Red Bull.
But in the view of Thai Tiansi and the Xu family, China Red Bull's business term has expired, and the shareholders have never reached any agreement to extend it, so it should be liquidated immediately and all business activities unrelated to liquidation should cease. During the transition period, Thai Tiansi decided to activate new partners and operating models to provide Red Bull products and properly arrange for China Red Bull's employees.
However, the court did not accept Thai Tiansi and the Xu family's application for compulsory liquidation of China Red Bull. Some lawyers said that Thai Tiansi's move was to establish a new operating entity that could distribute dividends, and after the death of Red Bull founder Xu Shubiao, they launched multiple lawsuits to eliminate the corresponding litigation subjects. But whether it is Thai Tiansi and the Xu family, or Huabin Group and Yan Bin, besides litigation, both sides are also using statement wars to ensure their positions. "**Ultimately, it is a problem of interest distribution.** The Xu family is dissatisfied that China Red Bull has made huge profits for nearly 20 years without ever paying dividends," said securities analyst Guo Jing. Although Huabin Group has temporarily preserved China Red Bull's operating entity and avoided compulsory liquidation, for both sides, the game over equity, trademarks, and other aspects has become more complex.
Furthermore, on May 29, 2019, with the Supreme People's Court's Second International Commercial Court hearing the case of plaintiff Thailand Huabin International Group (controlled by Yan Bin) versus defendant Red Bull Vitamin Beverage Co., Ltd. (controlled by Yan Bin and the Xu family) and third party Inter Biopharmaceutical Holdings Co., Ltd. (wholly owned by the Xu family) regarding shareholder qualification confirmation, the court conducted a hearing on five aspects, including the capital contribution of Inter Biopharmaceutical's equity, the equity in question, and the actual exercise of shareholder rights and obligations. The hearing lasted nearly 4 hours, with the verdict to be announced later.
However, according to the defendant Red Bull Vitamin Beverage Co., Ltd.'s representative, the verdict will directly affect the equity ratio of the Xu family and Yan Bin in China Red Bull, and the ownership of equity will directly determine the survival of China Red Bull, valued at 50 billion yuan.
**Dual-Brand Competitive Strategy**
**Although the future direction of China Red Bull is still unclear, and the lawsuits between Thai Tiansi and the Xu family, and Yan Bin and Huabin Group over trademark rights and other matters are not yet concluded, it is certain that competition at the product level has already begun.**
**Thai Tiansi has repeatedly stated that it will activate new partners and operating models to provide Red Bull products.** In 2017, Thai Tiansi acquired Guangzhou Yaonengli Beverage Co., Ltd., obtaining the "Blue Hat" health food certificate approved by the State Food and Drug Administration, and completed the trademark registration for Red Bull Anji by the end of that year. The latter then cooperated with Zhongshan Shengxing Factory for trial production of Red Bull Anji products.
On June 13, Red Bull Anji was officially launched. It is worth noting that the legal representative of Guangzhou Yaonengli Beverage Co., Ltd. is Yan Yongyi, international business consultant of Thai Tiansi. Thai Tiansi also stated that Red Bull Anji is currently the product authorized by the Red Bull brand founder Xu family and Thai Tiansi for effective authorization in mainland China, and has obtained approval from the China Food and Drug Administration as a Red Bull brand beverage. Before launching the new product, market tests were conducted in five major cities for more than 6 months.
It is understood that the front of the single can of this brand is almost identical to the Red Bull beverage produced by China Red Bull, except that the product name has been changed from "Vitamin" to "Anji." In terms of channels, "Red Bull Anji" is promoted as the "authentic Red Bull beverage," further highlighting its status as the "legitimate descendant." According to Anji's distributors, Anji is currently competing with Red Bull through price wars in channels, with a retail price of 6 yuan per can, an opening price of 116 yuan per box, and a promotion of 3 boxes plus 4 extra cans.
Yan Bin was not unprepared for this frontal confrontation. As early as 2014, Huabin purchased a 25% stake in American coconut water Vita Coco, introduced children's beverage Guozishuang and other brands, and at the end of 2016 launched a new functional beverage, War Horse, promoting it through Red Bull's channels. Yan Bin also told Xu Xinxiong more than once that Red Bull's taste is easy to imitate and that he could easily create a new brand.
"During the explosive growth period of functional beverages, both sides increased brand promotion. In the absence of a winning lawsuit, they each launched their own brands to seize market share," Zhu Danpeng said. Taking Red Bull Anji as an example, although its packaging is similar to Red Bull, it uses Yaonengli's formula, which differs significantly from traditional Red Bull in function and taste. Consumer acceptance may not be high, which could pose significant resistance to subsequent sales.
The previous performance of War Horse may illustrate some issues. Despite Huabin increasing promotion efforts for War Horse, with sales staff commissions for selling War Horse much higher than for Red Bull, War Horse's sales were not optimistic. As of 2018, War Horse's sales were only 800 million yuan, with a market share of about 2%.
On the other hand, according to data from Qianzhan Industry Research Institute, by 2020, China's functional beverage retail volume is expected to reach 15.037 billion liters, with retail sales reaching 163.528 billion yuan. **The battle between Thai Tiansi and Huabin Group undoubtedly gives competitors more room to grow, and whether the new brands launched by the two sides can stand out among the many functional beverages will ultimately be tested by the market.**
Source: China Entrepreneur Magazine (ID: iceo-com-cn)


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