Abstract

P&G's decision to acquire Gillette for $57 billion on 28 January 2005, has made it the world's largest consumer goods company. The merged company has 21 billion dollar brands with annual sales exceeding $60 billion. P&G and Gillette's grooming brands seem to complement each other. P&G specialises in hair and skincare for women - such as Max Factor make- up. Gillette focuses on male grooming. Gillette's razor business looks attractive to P&G because it is more profitable and growing faster than lower-tech consumer product categories. Both P&G and Gillette have a strong heritage of product innovation. The merger is expected to give the two firms tremendous bargaining power vis-a-vis media companies and retail giants like. The two companies are confident that there will be no cultural problems when the post merger integration begins. But there are concerns that P&G may become more unwieldy and difficult to manage after the merger. There are also doubts whether all the synergies identified will materialise. Will the merger succeed?

Learning Objectives

The case is structured to achieve the following Learning Objectives:

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Keywords

P&G, Gillette, acquisition