Economy

Peltz advances plan to shake up Procter & Gamble

Peltz advances plan to shake up Procter & Gamble”

Consumer goods giant Procter & Gamble fired the latest salvo in its battle with activist shareholder Nelson Petlz Thursday, dismissing a 94-page white paper prepared by Peltz as containing "nothing substantive".

The plan comes as Peltz seeks one seat on the company's board, in the largest boardroom battle at a USA company and one that is shaping up to be one of the most expensive in recent history.

Shareholders will vote on October 10 on whether to add Peltz to the board.

Activist investor Trian Partners on Wednesday released its long-awaited plan to boost shares of Procter & Gamble, detailing changes meant to streamline and rejuvenate the maker of Crest toothpaste, Tide laundry detergent and Pampers diapers.

Trian Partners said P&G continues to suffer from eroding market share, aging brands, high costs and a "suffocating bureaucracy".

And while Peltz has previously provided some details about what he is seeking, the report provided many more details, as well as numerous charts seeking to show how P&G has underperformed its peers. The fund manager had said previously that its leaders don't have the power to control their destiny, which he insists impedes growth and adds costs and complexity.

The billionaire investor is calling for P&G to reorganize into three largely autonomous units: A beauty, grooming and health-care business; a fabric and home-care division; and baby, feminine and family-care products.

The move would break up P&G's "matrix" organizational structure, which Trian said slows decision making as well as the company's ability to respond to market changes. Trian, which owns a $3.5 billion stake, says P&G is now pressing the company to restructure and combine businesses, hire outside leadership, overhaul compensation and acquire small local brands to attract millennial shoppers, according to the Wall Street Journal'sSharon Terlep and David Benoit.



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