P&G; to shed Duracell

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Courtesy P&G;

Procter & Gamble Co. announced today that it will exit the Duracell brand by creating a standalone company for the personal power business.

Erin Caproni

Digital Producer- Cincinnati Business Courier

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Procter & Gamble Co. announced today that it will exit the Duracell brand by creating a standalone company for the personal power business.

The move is one of the first in CEO A.G. Lafley's plan to shed about half of the company's brands in order to make the Cincinnati-based consumer goods business more profitable.

The exit from the power business will happen in two steps, with P&G; finalizing its previously announced agreement to sells its interest in a China-based battery joint venture and then splitting off Duracell. The moves are expected to be complete in the second half of the 2015 calendar year.

The way Duracell, which has sales estimated between $2 billion and $2.5 billion, will become a separate company hasn't been determined yet, but P&G; is considering a spin-off, divestiture or other offer. Shareholders will be given the option of exchanging some, none or all of their P&G; holdings for shares in the newly formed Duracell company.

"We greatly appreciate the contributions of our Duracell employees. Since we acquired the business in 2005 as part of Gillette, Duracell has strengthened its position as the global market leader in the battery category," Lafley said in the announcement. "It's a business with attractive operating profit margins and a history of strong cash generation. I'm confident the business and its employees will continue to thrive as its own company."

The Duracell announcement came as part of P&G;'s quarterly earnings report, which included net sales that were unchanged from a year ago at $20.8 billion, including a negative 2 percentage point impact from the combination of foreign exchange and minor divestitures. P&G; reported earnings per share of $1.07, an increase of 2 percent over last year, and diluted net earnings per share of $0.69. It returned $4.2 billion in cash to its shareholders, including $1.8 billion in dividends and $2.4 billion of common stock purchases.

Caproni heads up web operations for the Business Courier.