http://story.news.yahoo.com/news?tmpl=s ... g_gillette

P&G to Acquire Gillette for $57 Billion

1 hour, 10 minutes ago

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By SETH SUTEL, AP Business Writer

NEW YORK - The Procter & Gamble Co. is buying shaver and battery maker Gillette Co. for $57 billion in a deal that would create the world's largest consumer-products company.

If regulators approve the deal announced early Friday, P&G will add Duracell battery, Right Guard deodorant and Gillette razors to its collection of more than 300 consumer brands, including Head and Shoulders shampoo, Pringles, Crest toothpaste and Bounty paper towels. The acquisition would vault P&G's sales to more than $60 billion annually.

Consumer products suppliers have been facing pressure from Wal-Mart Stores Inc., the world's biggest retailer, and other retailers to keep their product costs low.

Friday's deal is expected to help P&G and Gillette cut their combined costs but will also mean the elimination of about 6,000 jobs, which is about 4 percent of the combined work force of about 140,000, most of them by eliminating managerial overlaps and consolidating operations.

"We believe we can bring these companies together and create a juggernaut," Gillette Chief Executive James M. Kilts told analysts in a briefing on the deal Friday morning.

Kilts, who has agreed to stay on for at least a year to lead the integration of Gillette with P&G, said the combination would provide Gillette with opportunities to sell their products in developing markets including China and East Europe.

"I'm a great believer in scale," Kilts said. He said he would rather lead the consolidation in consumer products companies than "get stuck with the leftovers."

Both companies' boards unanimously approved the deal on Thursday.

Famed investor Warren Buffett (news - web sites)'s vehicle, Berkshire Hathaway Inc., owns 9.7 percent of Gillette, or about 96 million shares — a stake equivalent to 93.6 million P&G shares. Buffet, Gillette's largest single shareholder, called the combination "a dream deal" and said he plans to buy another 6.4 million P&G shares to reach 100 million by late this year when the sale is expected to close.

Cincinnati-based P&G will pay 0.975 of P&G share for each share of Gillette. Based on P&G's closing price of $55.32 per share Thursday, the deal values Boston-based Gillette at about $54 per share — an 18 percent premium over its closing price.

P&G also plans to buy back $18 billion to $22 billion of its stock during the next year to 18 months. As a result, the deal would ultimately be financed through about 60 percent stock and 40 percent cash.

"Gillette and P&G have similar cultures and complementary core strengths in branding, innovation, scale and go-to-market capabilities, making it a terrific fit," P&G Chief Executive A.G. Lafley said in a statement.

Kilts will become vice chairman of P&G and join its board.

The deal is a bold move by Lafley, who led the company out of dark times in 2000. Moving too fast on a restructuring plan implemented by Chief Executive Durk Jager, the company posted several disappointing quarters and its stock lost more than half its value in 2000.

Lafley replaced Jager in June 2000, slowed the pace of change and got the company back on solid footing. Its stock has risen by nearly one-third since 2003, with its strong global brands powering consistent sales growth.

As it resumed growth, P&G started acquiring brands that fit with its strategy — Germany's Wella AG hair care line in 2003 for $5.7 billion was the biggest acquisition until Thursday. P&G also acquired Clairol for its hair-care lines and Iams Co. for its pet foods.

The company reported strong quarterly earnings on Thursday, including a 12 percent jump in net income to $2.04 billion, or 74 cents per share, up from $1.8 billion and 65 cents per share in the same period a year ago.

P&G's sales increased 7 percent to $14.45 billion in the quarter.

Gillette also has reported strong earnings since Kilts joined the company in 2001. It has moved to buoy its premium-line shaving and dental care products and sales of Duracell batteries.

In its most recent quarter, Gillette reported income of $475 million, up from $416 million, as more consumers traded up to its pricier M3Power razor and the series of hurricanes in the South boosted battery sales. Gillette also sells Oral B dental care products.

I know

I heard about this on the radio today.

I'm hoping they'll do what Bank America is doing with the Fleet Center and buy their way out of the contract.

Since this didn't get much attention in N&D, I'm going to move it here for a while.

what's so wrong with P&G? I forgot.

Just do a search for boycott P&G.

oh right, I remember now.

Damn I love meat.

P&G Shareholders OK Gillette Acquisition
By DAN SEWELL, Associated Press Writer
July 12, 2005

CINCINNATI - Procter & Gamble Co. shareholders on Tuesday overwhelmingly approved buying the Gillette Co., another step toward forming the world's largest consumer products company.

A.G. Lafley, the company's chairman, president and chief executive, said 96.5 percent of the shareholder votes favored the $57 billion deal, which would bring prominent consumer brands under one umbrella, including P&G's Pampers diapers brand and Gillette's line of shavers.

"We have the opportunity to combine two of the world's leading consumer companies," Lafley said at a special shareholder meeting. "This is a great deal for P&G and shareholders alike."

Most shareholders voted before the meeting on the deal announced in January. Gillette shareholders were scheduled to vote later Tuesday in Wilmington, Del.

The Federal Trade Commission still is reviewing the deal and the European Commission has a Friday deadline to approve the merger or begin an in-depth probe. Earlier reports said the companies could sell some overlapping dental-care product lines to address competition concerns.

Lafley said discussions with regulators seemed to be going well, and the deal could be closed by early fall.

The deal would be the largest acquisition in the 167-year history of P&G, whose range of brands includes Crest, Tide and Head & Shoulders. Besides its line of razors, Boston-based Gillette makes Braun electric shavers, Oral-B toothbrushes and Duracell batteries.


--x--

fyi, especially for those who tend to boycott or avoid Procter & Gamble,....

c-

I own stock.

oh geez...was it PJDoll who was boycotting P&G?

Now where will we find our non-animal tested beauty products???

Aw, man! I can't win with her this week!

I told her about this a long time ago--as evidenced by this merge.

EDIT: Oh, and it's going to take a very convincing move for me to stop using Right Guard.

You own stock?

If I ever, and I mean EVER, hear you talk about greedy corporate bastards again, I'm going to laugh my ass off and remind everyone that you are hoping to profit from one of the world's cruelest corporations.

Nice job practicing what you preach.

It was a gift. What am I supposed to do? Throw it away?

convinced yet?

I hit a groundhog with my car today and then shaved it with some Edge Gel and then put some lipstick on it.

I looked at that website. That's a very sad, unreferenced, undated photograph.

In fact, that website doesn't provide one single reference to any information that backs up its claims.

I suggest you write to the link that sends an email directly to P&G informing them of your intent to boycott them and why. They send you back a lie filled letter explaining that they must do this, it's the law. Only, it isn't.

But you're right, the website is just lying because the girl that runs it was stood up by a VP at P&G back in high school

I'm not claiming it's lying. I think it's outdated and inflammatory.

It's not really, it's just sad. They still conduct all of these tests, and unnecessarily.