P&G has built factories and established distribution lines in China, and already has the top-selling brands in shampoos and conditioners, facial moisturizers and baby care products. Its laundry detergents, toothpaste and feminine care products occupy the No. 2 positions in the Chinese market as well.
When the joint venture was established in 1988, P&G had a 69% stake, which it expanded to 80% in a 1997 restructuring of the deal. The agreement contained provisions allowing it to buy the rest of the stake in 2007.
The only cost to the cash-rich Cincinnati, OH-based company would be the minimal interest it would forego to make the purchase. P&G executives expect the deal to close on June 18, but did not specify its financing plans.