P&G board sticks by CEO after Ackman stake

Associated Press

NEW YORK (AP) — Procter & Gamble Co. said Wednesday that its board supports CEO Robert MacDonald, nearly a week after activist investor William Ackman took a stake in the company.

The world's largest consumer products maker said in a Securities and Exchange Filing that the statement is in response to erroneous media reports. P&G makes products ranging from Tide detergent to Gillette razors.

"The board is overseeing a plan to return P&G results to levels that produce the best long term value for shareholders; unanimously supports the plan and chief executive officer, Bob McDonald, as he leads its implementation; and is monitoring its effectiveness," P&G said in the filing.

Since Ackman took an undisclosed stake in the company last week, media reports have speculated he might agitate for change, such as a split up of the company or new leadership.

He has done that with other companies, including Target and J.C. Penney. But he has made no formal statement about P&G yet.

Procter & Gamble has been struggling to gain market share globally. The 175-year old Cincinnati company has been expanding internationally as growth in the U.S. and other mature markets slows. But weakness in Europe and uncertainty about the overall global economy, coupled with high costs for commodities such as fuel and packaging, has led to lackluster results.

In its most recent quarter, P&G said net income fell 16 percent while its overall market share slipped 0.2 points, including a decline of 0.6 points in North America.

Shares gained 10 cents to $64.89 in midday trading, after an initial dip following the filing.

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