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Peltz's Trian Partners released its long-awaited proposal on
Wednesday, and called for P&G to be organized into "three
largely autonomous business units under a lean holding company".
"Mr. Peltz's suggestions would be value destructive, and we
believe it represents another example of his misguided view of
P&G’s business," P&G said in a statement.
P&G said it had studied several organizational structures,
including the one proposed by Peltz, and concluded it would
result in higher costs, lower efficiency, reduced profits, and
an added layer of management complexity.
Trian, P&G's fifth-largest shareholder, has been locked in a
prolonged battle with the consumer products conglomerate,
raising investor hopes of a break-up of the company.
In July, Peltz made public his frustrations with the company's
lagging stock price and its "suffocating bureaucracy" and said
he was seeking a board seat, a demand the company has turned
down.
"The board evaluated Mr. Peltz against its previously identified
list of desired skills and experiences and concluded that he did
not fill a current need," P&G said in the statement, adding that
it did not get positive recommendations about Peltz from others
who have worked with him.
Shareholders will vote on Oct. 10 on whether to add Peltz to the
board.
P&G's shares, which have risen 5.5 percent since Peltz announced
his stake in the company in February, were slightly higher
before the opening bell.
(Reporting by Sruthi Ramakrishnan in Bengaluru, editing by
Bernard Orr)
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