P&G Plans to Vote Against Angry Wella Investors

Procter & Gamble told angry Wella minority shareholders on Tuesday it would vote down three key motions filed by rebel investors still trying to fight its 2003 takeover of the German hair care firm, according to a Reuters report. P&G holds almost 100% of Wella voting rights and about 80% of its share capital.

Amid heckling by shareholders, P&G’s representative at a shareholder meeting in Frankfurt said the consumer goods giant did not need a so-called domination agreement, a measure under which the U.S. firm would have to compensate minority owners.

Wella chief executive Heiner Guertler himself also sought to persuade skeptical investors that he could drive as hard a bargain with Procter & Gamble as with any other competitor, highlighting the advantages of a recent marketing agreement with the U.S. firm. Last week’s move to hand over to P&G the marketing and sales of Wella products such as ShockWaves and Wellaflex would ensure a much better return from the division, he said.

Rebel shareholders — who fear that Wella is not being run in their best interest — were not convinced. The investors claim that P&G is treating a firm in which it owns an 80% stake as a wholly-owned subsidiary and say that Cincinnati, OH-based P&G has a track record of allowing its own products to steal market share from recently acquired ones, such as the Vidal Sassoon brand.