US business tycoon Warren Buffett has announced he is to buy battery brand Duracell from Procter & Gamble (P&G) through his Berkshire Hathaway fund in a $4.7bn deal.
It marks the latest major consumer brand acquisition for the billionaire, chief executive at Berkshire Hathaway, who acquired food company Heinz for $28m last year.
The deal will see Berkshire Hathaway return its $4.7bn shareholding in P&G back to the FMCG giant. P&G added that it expects to contribute approximately $1.8bn in cash to Duracell, made famous by its ‘Duracell Bunny’ advertising, to help recapitalise the brand.
“I have always been impressed by Duracell, as a consumer and as a long-term investor in P&G and Gillette,” said Buffett. “Duracell is a leading global brand with top quality products, and it will fit well within Berkshire Hathaway.”
P&G chief executive AG Lafley, who only last month revealed plans to divest Duracell, insisted the company is making “good progress” against the “right strategic priorities”.
He said: “We’re clear-eyed about the challenges we face from external forces, like currencies. We will continue to accelerate and increase productivity savings, sharpen our strategies and strengthen our portfolio – all focused on delivering superior value to consumers and balanced growth and value creation for P&G shareowners.”
Speaking at yesterday’s annual investor day, P&G’s global brand officer Marc Pritchard reportedly told delegates the company is shifting marketing dollars to digital media, and is focused upon reducing the “clutter” in its messages to consumers.
“With the overwhelming amount of information clutter in the world, we’re finding that fewer advertising messages, communicated more consistently and with fewer changes, are more effective at delivering top-of-mind awareness,” said Pritchard.