P&G Poised to Ink $4.95bn Clairol Deal

21 May 2001

An announcement is expected today that Procter & Gamble is to acquire Bristol-Myers’ Clairol brand range for $4.95 billion, according to insiders. The deal, if inked, leaves rival bidder, Japan’s Kao Corporation, out in the cold.

Negotiations reached breakthrough point over the weekend after P&G sweetened its offer by several hundred million dollars – necessary to overcome the intense competition scrutiny it is expected to face given its significant extant hair-care assets, among them market-leader Pantene, Head & Shoulders, Pert, Vidal Sassoon, and Physique.

But P&G, not known for squandering shareholders’ funds, can afford to pay over the odds for Clairol as the acquisition could bring with it a huge tax dowry –as much as $1 billion over fifteen years in amortization of goodwill.

News source: Wall Street Journal