Procter & Gamble sell its Duracell business

Procter & Gamble Co. are more famously known as P&G. The American based multinational company of consumer goods is one of the dominant companies in its industry. The company has been one of the great multinational consumer goods companies that specialize in pet foods, cleaning agents, and personal care products. One of the businesses of the company was the Duracell business. PG already have brands such as Gillette razors, Duracell, Braun, and Oral-B to their stable. The company officials recently announced that it will sell its Duracell business to Warren Buffett's Berkshire Hathaway Inc. (BRK-A) in a deal that values the battery unit at close to $3 billion.

The company’s plans are to recapitalize Duracell with about $1.8 billion in cash prior to handing over ownership of the business. The deal is done in such a way that it has benefitted P&G more than the buyer company. Even losing one of its most successful businesses, the company now has gained more from selling it. It is believed that “In exchange for the world's largest battery brand, P&G will receive Berkshire Hathaway's stake in the seller worth approximately $4.7 billion. The transaction is expected to close in the second half of 2015.”

The CEO of the company, A.G. Lafley said “We have the right strategic priorities, and we're making good progress against all elements. 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.”

Hence in a nutshell, the company is confident enough and content to sell its successful Duracell business. In exchange, the company now has a stake of same worth of the buyer’s company which will be influential in the longer run.