Bill Ackman’s Pershing Square hedge fund has been given clearance by the Federal Trade Commission to make an investment in Procter & Gamble, clearance that is required before making a large investment in a company.
P&G has lagged its peers over the past two years, rising by roughly 4% while Colgate-Palmolive (CL) is up 28% and Unilever (UN) is up 18%. Additionally, the company said late last month that sales and profit are going to be lower than originally expected as it struggles to manage pricing and combat higher commodity costs.
Sources close to the company note that morale is low internally and investors are becoming increasingly frustrated by P&G’s struggles versus its peers. Ackman has a history of taking large positions in companies, then aggressively pushing for changes that he believes will add value for investors. Earlier this year, he won control of CP Rail (CP), forcing a change in the CEO position. He also took a large stake in J.C. Penney (JCP), helping engineer the move that brought former Apple (AAPL) executive Ron Johnson in as CEO of the company.
Procter & Gamble (PG : NYSE : US$63.70), Net Change: 2.30, % Change: 3.75%, Volume: 36,914,647