Procter & Gamble Co (PG) Proxy Fight

Xavier Trudeau
Juillet 17, 2017

Trian is seeking one seat (out of 12) - for Peltz - on P&G's board at the company's annual stockholders' meeting tentatively on the calendar for October.

An activist investor that is looking to shake up American consumer goods giant Procter & Gamble has moved to put its chief executive on the board to influence what it sees as a much-needed turnaround.

For instance, Peltz acknowledged during a CNBC interview that P&G is a "great company" that's backed by a "phenomenal" CEO David Taylor who hasn't yet lived up to his full potential. The shares gained 0.6 percent to $87.59 in early trading in NY after the filing was posted. The Company's management acknowledges the need to reduce cost and bureaucracy, but it is clear to us that these critical issues have not been sufficiently addressed. The company carried a market valuation of almost $224 billion. In the subsequent meetings, Trian outlined ideas for accelerating growth and improving profitabilty and performance, including by cutting down on bureaucracy within the organization. The request was deemed "unnecessary" by P&G directors in light of recent initiatives the company had implemented, according to the proxy filing.

Can Trian Fund Management really fix what ails Procter & Gamble (PG)?

Analyst Kevin Grundy of Jeffries said in a client note that while P&G has taken "sensible" steps to boost shareholder value and there's no guarantee that Peltz will get a seat on P&G's board, "the perceived value of his presence may lead to greater/faster realization of cost savings and/or raise the execution bar at P&G". Trian, whose plans were reported earlier by the Wall Street Journal, said Monday it still hopes it can avoid a proxy fight.

It's not the first time P&G has been targeted for a shake-up. Worth $222 billion, P&G is the largest company to ever face such a campaign.

Trian said P&G's previous cost-cutting measures have not been successful, citing a $10 billion cost-cutting program launched in 2012 that has "had no discernible impact on profits or sales growth".

D'autres rapports CampDesrEcrues

Discuter de cet article