Procter & Gamble, the largest United States household goods maker, has won European Union antitrust approval to buy Gillette for US$57 billion ($84.6 billion) after agreeing to sell its Crest SpinccBrush toothbrush business.
"We gave it a firm eye and we asked for divestments," Competition Commissioner Neelie Kroes said in
an interview in Brussels.
"They promised to do so and that's a deal."
P & G agreed to divest the SpinBrush unit and to grant a licence for the Crest, AZ and Blendi brands used on the battery-operated toothbrushes, the European Commission said at the weekend.
The approval ends investor uncertainty about the status of the transaction in Europe and averts an investigation by European antitrust officials that could have delayed a ruling for another four months.
"It's very positive for both companies," said Dan Popowics, who helps manage about $20 billion at Cincinnati-based Fifth Third Asset Management, including P&G shares. "There was some concern that the timing of the approval would be pushed out.
Now the transaction can move along."
Shares of Cincinnati-based P & G fell 25c to US$54.50 in New York Stock Exchange composite trading on Friday. Shares of Gillette, based in Boston, fell 3c to US$52.60.
P & G has announced that it has hired Merrill Lynch & Co to help sell the SpinBrush business, which is mainly in the US, Canada, Europe and Japan.
The companies still need US approval for the transaction.
In March, they got a request from the Federal Trade Commission to provide additional information. P & G has said it expects to close the purchase thisnorthern autumn.
P & G, which agreed in January to buy Gillette, is making the acquisition to add faster-growing Mach3 razors, Oral-B toothbrushes and Right Guard antiperspirants to its own businesses.
- BLOOMBERG
