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P&G buys Gillette Company, creates powerhouse of 21 billion-dollar brands

P&G buys Gillette Company, creates powerhouse of 21 billion-dollar brands

Author | Kalyan Kar | Saturday, Jan 29,2005 8:05 AM

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P&G buys Gillette Company, creates powerhouse of 21 billion-dollar brands

Apart from being a mega corporate merger, this perhaps is as big as it gets in the realm of brands acquisition. On Thursday, Cincinnati-headquartered Procter & Gamble Company signed a deal in the USA to acquire 100 per cent of The Gillette Company for $ 57 billion, the largest in P&G's history.

The outcome: the creation of a global brand powerhouse comprising 21 billion-dollar brands -- P&G has 16 billion-dollar brands; Gillette brings in five more. The combined company will have a No. 1 global market position in categories representing about two-thirds of total sales.

Confirming the deal, Zubair Ahmed, Managing Director, Gillette India, told exchange4media, "Yes, the deal has been signed in the US, and consequently, Gillette India too will become part of P&G." Ahmed added that Gillette India is owned 75 per cent by parent The Gillette Company, and this stake will now go to P&G. Of the balance 25 per cent, SK Poddar owns around 12.5 per cent, and the rest is with the public.

Ahmed also said that "as a result of this deal, all Gillette brands in the categories of shaving systems, blades, oral care and grooming products even in India will now become part of the P&G fold."

And what an awesome brand bandwagon this will be. P&G's brand portfolio consists of Pampers, Tide, Ariel, Always, Whisper, Pantene, Bounty, Pringles, Folgers, Charmin, Downy, Lenor, Iams, Crest, Actonel, Olay, Clairol Nice 'n Easy, Head & Shoulders, and Wella.

On its part, Gillette is the global leader in male grooming. Founded in 1901, Boston-headquartered Gillette markets a number of category-leading consumer products such as Gillette razors and blades including the Mach3 and Venus brands, shaving preparations, toiletries and deodorants; Duracell Copper Top batteries; Oral-B manual and power toothbrushes; and Braun shavers and small appliances.

Gillette also holds a strong position worldwide in selected female grooming products. In fact, P&G and Gillette have complementary expertise in health and personal care. Historically, P&G has had strength in women's personal care with brands such as Olay, Always, Tampax, Cover Girl and Max Factor. Gillette holds a strong position worldwide in selected female grooming products, such as wet shaving products and hair depilation devices under the Gillette and Braun brand names.

This is one piece of news that would not have failed to send a few tremors within the corridors of Hindustan Lever and Colgate-Palmolive. After all, the market may never be the same again in the personal care and oral care segments.

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