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P&G’s Potential Personal Care Brands Divestment Sparks Analyst Support

This article was originally published in The Tan Sheet

Executive Summary

P&G could divest, at one fell swoop, prestige fragrances, makeup brands Cover Girl and Max Factor, and salon and small retail hair-care brands, analysts speculate, following reports that the firm is exploring a possible sale or IPO of personal care and beauty brands en masse.

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Slimmed-Down P&G To Consist Of 65 ‘Leading Brands’ By FY 2017

At the CAGNY conference Feb. 19, P&G leadership provided new insight into the company’s streamlining program, specifically where the firm will end up after selling off 100 underperforming brands in deals expected to be closed by June 30, 2016. CFO Jon Moeller listed Gillette, Pantene, Head & Shoulders and Olay among core brands that will emerge from the simplification, highlighting recent innovations and marketing initiatives that are resonating with its core audience and driving growth.

P&G Portfolio Trimming ‘Full Steam Ahead’ As Currency Effects Pummel Profit

P&G’s net income fell 31% in its second quarter and will decline for its full fiscal 2015 due to foreign exchange; the firm remains focused on core brand growth and innovation while it weathers the storm. So far, P&G has sold or consolidated 35 of the 90 to 100 brands on its streamlining chopping block, it says.

Kao Is ‘Best Fit’ For P&G’s Rumored Wella Divestiture – Euromonitor

If reports prove true and Wella hair care is the next brand on P&G’s chopping block, Kao would have much to gain from the acquisition while posing minimal competitive risk to P&G, Euromonitor analyst Oru Mohiuddin observes. The business could sell for upwards of $7 billion, sources told Reuters in December.

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