P&G to Seize Full Control of Chinese Business

13 May 2004

Procter & Gamble is to take full control of its Chinese joint venture with Hong Kong's Hutchison Whampoa earlier than expected.

The consumer goods colossus intends to purchase the 20% of Procter & Gamble-Hutchison that it does not already own for $1.8 billion (€1.5bn; £1.0bn). Established in 1988, the venture sells a wide range of P&G products in China.

Under a previous timetable agreed by the two companies, P&G was not due to take full control until 2007 at the earliest. However, with Chinese sales growing at 30% a year and forecast at over $2bn in 2005, P&G decided to move now in case the price rose later.

"The outstanding results of our China business give us confidence that we have the right people, the right business strategies and the in-depth understanding of local consumers and retailers in China to continue to build this fast-growing business," said P&G chairman, president and ceo A G Lafley.

The deal is expected to close on June 18.

Data sourced from: Wall Street Journal Online; additional content by WARC staff