Trian launches public fight to add Peltz to P&G's board


After almost five months of discussions, P&G last week rejected a demand from Trian to name Mr. Peltz a director, the people said, setting the stage for what could be months of public debate over how to get the maker of everything from Tide detergent and Gillette razors to Pampers diapers on a stronger growth trajectory. That said, while having absolutely intimate knowledge of the operating structure, financials and culture of P&G, Mr. Daley taking on the role of change agent would be a clear divergence from his past tenure.

However, it has suffered in recent years from the slowdown in the global economy as well as from competition from startups. It faced an earlier activist approach from William Ackman and has cycled through leaders as the stock price has lagged. For this year, the consumer goods giant expects a 2-3 percent rise in organic sales growth.BATTLE LINESThe Trian-P&G battle comes as activist investors, emboldened by years of successful campaigns for changes at corporations across the USA and overseas, use their growing coffers to seek bigger targets.

Trian says that Peltz will nominate the director that he replaces, which would expand the Board to a new total of 12 members. It isn't seeking a breakup as some analysts have speculated since the investment was disclosed in February.

Trian has said that if it were to win a seat it would strive to create an extra one and renominate the person who lost, to ensure no existing members lose their positions.

The company, which is based in Cincinnati and whose brands include Gillette, Tide and Pampers, is struggling to navigate changing consumer habits.

"We need a game-changing attitude at P&G", Mr. Peltz said in an interview.

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Nonetheless, an updated note to investors by Deutsche Bank Markets Research characterized Trian's proxy plan "as a sign that (P&G) management is confident in its strategy and is unlikely to miss expectations over at least the next few months".

Yet sales and profit growth have remained elusive.

However, absent strong growth more than five years into the strategy, P&G represented a large target for dissatisfied Wall Street investors. P&G's quarterly organic sales, which excludes acquisitions and divestitures, has fallen just once during his one and half years at the helm.

Mr. Taylor has said the company was failing to deliver and "we need to bring our standards up". Worth $222 billion, P&G is the largest company to ever face such a campaign.

Mr. Peltz may not have all the answers to Procter & Gamble's troubles, but a fresh look on the board is warranted.