Business Case Studies, Mergers, Acquisitions and Takeovers Case Study, P&G's Takeover of Wella, The Stumbling Blocks

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Mergers, Acquisitions and Takeovers Case Study

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Case Title:

P&G's Takeover of Wella : The Stumbling Blocks

Publication Year : 2004

Authors: G.Shrikanth, T Phani Madhav

Industry: Home Appliances and Personal Care Products

Region:Germany

Case Code: MAA0007

Teaching Note: Not Available

Structured Assignment: Not Available

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Abstract:
When Procter and Gamble (P&G) acquired Wella, the German beauty products giant, the synergies painted a rosy picture. But the company is having its own share of woes with unrelenting minority shareholders refusing to sell the preference shares, expressing their dissatisfaction over P&G's offer. They demanded that the preference shares should also receive the same price as that of voting shares. Even a year after the acquisition, the stalemate continues.

Pedagogical Objectives:

  • The case delves into the synergies that P&G sought through Wella's acquisition, and how the differential offer that the company made is stopping it from taking full control of Wella
  • The case offers scope to discuss the cross-border takeovers in the light of country-specific regulations. The case in point being the German Takeover Act.

Keywords : Mergers, Acquisitions, Alliances Case Study;Procter and Gamble (P&G); Wella; German takeover act; Preference shareholders; Voting shares; Two-tiered offer; Elliott Associates; AG Lafley; Heiner Gurtler; BaFin; Domination agreement.

Contents : 
Wella’s Percentage Sales by Activity
The Global Beauty Industry Composition
The World’s Top 20 Beauty Companies by Revenues in 2002
The German Takeover Act
The Global Personal Care Industry
P&G's Acquisitions in the Beauty Industry

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