Sep. 29--BEIJING -- Coca-Cola's friendly $2.5 billion bid to buy China's biggest juicemaker is emerging as a test of whether Beijing will allow foreign companies to buy homegrown businesses--or force entrepreneurs to serve its vision of creating national economic champions.

Huiyuan Juice Group Ltd., little known outside China but with an estimated 42 percent of the country's pure juice market, could become a victim of its own success if Beijing deems it too big and famous to fall into foreign hands.

Huiyuan's green cartons of orange, apple, pear and grape juice are ubiquitous in Chinese groceries. Acquiring the company would expand Coke's presence in a major market. For Huiyuan, which welcomes the deal, being acquired would give it access to experience at product development and marketing.

The bid, announced Sept. 3, has ignited a firestorm of criticism in China, where the state-controlled press and schoolbooks nurture grievances over colonialism.

The communist government routinely defies public opinion when deciding on job cuts at state companies or other painful steps deemed necessary for China's overall good. But Chinese leaders might share the public's distaste about Coke because the bid collides with their goal of building major Chinese companies to dominate domestic industries.

Beijing is likely to reject Coca-Cola Co.'s bid for the very reasons Huiyuan is an attractive target--it is successful and well-known, said Donald Straszheim, an American investment banker who specializes in China.

"While the shareholders on both sides might approve, we do not see significant reasons why the authorities would approve this deal, allowing a major acquisition by a foreign firm of a highly visible domestic company," Straszheim, vice chairman of Roth Capital Partners, said in a report to clients.

Others say Coke might be able to win approval--and survive a review under China's new anti-monopoly law--if it can make a case that the deal will benefit China. The American suitor says it will retain the Huiyuan brand and invest to develop it.

"If Coke offers a really great amount of money, nationalism will yield to the money," said Conita Hung, director of equity markets for Delta Asia Financial Group in Hong Kong.

A Coca-Cola spokesman, Kenth Kaerhoeg, said managers have met with Chinese regulators but he declined to comment on the review process.

Beijing issued rules in 2006 that bar foreign ownership of companies in power generation, weapons and other industries, but fruit juice-makers are not mentioned.

Chinese companies are stepping up acquisitions abroad. Lenovo Group acquired IBM Corp.'s personal computer unit in 2005. More recently, Aluminum Corp. of China bought a stake in London-based Rio Tinto Group.

At home, Beijing actively pursues foreign investment, and received $52.4 billion in the first half of this year.

Yet communist leaders' attitude toward the outsiders who have helped to finance China's boom is fraught with tension and conflict.

The Internet-enabled public has often savaged Beijing as being inept in dealing with foreign capitalists. The government and its banks were criticized for buying too many Fannie Mae and Freddie Mac bonds and for taking a pre-IPO stake in the U.S. investment group Blackstone LP--deals that have turned out poorly.

That is likely to make the government leery of exposing itself to more criticism by selling off a high-profile name such as Huiyuan.

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