Procter & Gamble Company (PG), a manufacturer of consumer goods, has completed its acquisition of the Ambi Pur brand from Sara Lee Corporation (SLE) for €320 million (about $470 million). Procter & Gamble will pay about 12% of the total consideration into escrow account pending deferred transfers of certain assets.
In February 2010, Sara Lee hedged €1.6 billion at $1.35 per euro in anticipation of proceeds to be generated by the divestiture of its Household & Body Care business. This deal was initiated by Sara Lee in December 2009.
The Ambi Pur acquisition enlarges Procter & Gamble’s global leadership in Home Care and specifically Air Care, and will widen its base in Europe and Asia. Procter & Gamble’s growth drivers include product innovation, expansion into emerging markets, and continuing cost-cutting through process simplification and productivity enhancement.
For Sara Lee, this divesture is part of its strategy to sell its international Household & Body Care business. The company has recently closed the sale of its 51% stake in its Godrej Sara Lee joint venture to Godrej Consumer Products Ltd. for a total price of €185 million ($230 million).
Sara Lee is also in discussions with Unilever to sell off its global body care and European detergents businesses. To divest its insecticides business, the residual part of Household & Body Care division, Procter is in conversation with SC Johnson. Both these divestures are expected to be complete by the end of 2010, subject to customary closing conditions.
The completion of pending divestures will transform Sara Lee into a leading global food and beverage company. The disposal of non-core assets would also help invest these proceeds in accretive acquisitions. Sara Lee also intends to enhance shareholder return by using the proceeds to repurchase shares.
Ambi Pur, an air freshener brand with various products to be used in the living room, toilet, wardrobes and car, as well as perfumes. Its products are available worldwide with significant presence in the United States, Europe and Asia.
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