Filed by The Gillette Company
Pursuant to Rule 425 under the
Securities Act of 1933 and deemed
filed pursuant to Rule 14a-6(b) of
the Securities Exchange Act of 1934
Subject Company: The Gillette Company
Commission File No.: 333-123309
The following overview was presented to employees of The Gillette Company:
Overview of Procter & Gamble 2004/05 1 |
Overview of Procter & Gamble o P&G History o Facts & Figures o Purpose, Values & Principles o Company Structure o R&D Innovation o Careers o Q&A 2 |
P&G History An Unlikely Meeting: William Procter and James Gamble o Embarked on separate journeys to the U.S. from England/Ireland o Married sisters, whose father convinced them to become business partners o Founded P&G in 1837 William Procter James Gamble Candle Maker Soap Maker 3 |
P&G History Historical Highlights: 1837 to mid 20th century 1837 Company founded 1850 New manufacturing facility opens in Cincinnati, OH 1859 $1 Million net sales 1879 Ivory Soap introduced 1882 First brand advertisement (Ivory Soap) 1890 Incorporated 1915 Canada: first international subsidiary 1923 First radio ad (Ivory Soap) 1930 England: first overseas subsidiary 1939 First television ad (Crisco) 1946 Tide introduced 1955 Crest introduced 4 |
P&G History 1956 $1 Billion net sales 1961 Pampers introduced 1963 Folgers Acquisition 1974 Toll-free consumer hotline 1980 $10 Billion net sales 1985 Richardson Vicks acquisition 1989 CoverGirl acquisition 1989 $20 Billion net sales 1999 Iams acquisition 2001 Clairol acquisition 2002 $40 Billion net sales 2003 Wella acquisition 2004 $50 Billion net sales 5 |
Overview of Procter & Gamble o P&G History o Facts & Figures o Purpose, Values & Principles o Company Structure o R&D Innovation o Careers o Q&A 6 |
P&G-2003/04 Gillette 2004 - ------------------------------------------------------------------------------------------------------------ Sales $51.4 billion $10.3 billion est. - ------------------------------------------------------------------------------------------------------------ Earnings $6.5 billion $2.3 billion est. - ------------------------------------------------------------------------------------------------------------ Dividends per Common Share $0.93 $0.65 (in 2003) - ------------------------------------------------------------------------------------------------------------ R&D Expenditures $1.8 billion o $202 million (in 2003) o Not available yet for 2004 - ------------------------------------------------------------------------------------------------------------ Leading Brands Tide, Always, Iams Pantene, Mach3, Gillette, Oral B, Duracell, Braun Charmin, Bounty, Actonel, Crest, Ariel, Downy, Pampers, Pringles, Folgers, Wella, Olay, Head & Shoulders - ------------------------------------------------------------------------------------------------------------ Brands w/Sales > $1 billion 16 5 - ------------------------------------------------------------------------------------------------------------ Number of Employees 110,000 30,000 - ------------------------------------------------------------------------------------------------------------ Manufacturing 106 in 41 countries 31 plants in 14 countries: Brazil, Mexico, Belgium, Czech Republic, France, Germany, Ireland, Poland, Russia, Spain, United Kingdom, United States, China, India - ------------------------------------------------------------------------------------------------------------ R&D Centers 21 Technical Centers in 11 3 - Germany, United Kingdom, United States countries on four continents. - ------------------------------------------------------------------------------------------------------------ Chief Executive A.G. Lafley, Chairman, James M. Kilts, Chairman, President and CEO President and Chief Executive - ------------------------------------------------------------------------------------------------------------ 7 |
Facts & Figures P&G/Gillette - The Combined Companies* o Combined sales of $62 billion o 21 global brands with sales of over $1 billion o Combined workforce of 140,000 o New opportunities for Gillette in developing countries, like China and Russia o New opportunities for P&G where Gillette is strong, like Brazil and India * Subject to shareholders and government approval. 8 |
Facts & Figures Signs of P&G Success o Markets nearly 300 brands that touch and improve the lives of our world's consumers in more than 160 countries o Global leader in 7 of the 12 different product categories in which we compete. Closest competitor leads in only two of 16 billion dollar global brands. o Spends more than $5 million a day on R&D o Sales total more than $51.4 billion worldwide 9 |
Facts & Figures 2004 Net Sales by Business Segment 10 |
Facts & Figures Recent Third Party Recognition o Only company on all 7 Fortune lists for 2003 and 2004. o #6 on Fortune's Global Most Admired Companies and #10 for America's Most Admired Companies 2005 o #8 on Business Ethics' 100 Best Corporate Citizens list 2005 o #66 on Fortune's 100 Best Companies to Work For 2005 o Among the 2005 Top 30 Companies for Executive by the National Association for Female Executives (NAFE) o #27 on DiversityInc's Top 50 Companies for Diversity 2005 o Ranked on Working Mother's Best Companies for Working Mothers, 17 out of 19 years o Ranked among the Best Employers/Places to Work in Canada, Germany, Portugal,Italy, Latin America and Chile 11 |
A.G. Lafley Chairman of the Board, President and Chief Executive 12 |
Facts & Figures Key Corporate P&G Executives - Vice Chairmen Susan E. Arnold Bruce L. Byrnes Vice Chairman-Global Beauty Care Vice Chairman-Global Household Care R. Kerry Clark Robert A. McDonald Vice Chairman-Global Health, Vice Chairman-Global Operations Baby & Family Care 13 |
Facts & Figures Key Corporate P&G Executives - Functional Leaders Richard L. Antoine G. Gilbert Cloyd Clayton C. Daley, Jr. R. Keith Harrison, Jr. Global Human Resources Chief Technology Officer Chief Financial Officer Global Product Supply Officer Officer James J. Johnson Charlotte R. Otto James R. Stengel Chief Legal Officer and Global External Global Marketing Officer Secretary of the Company Relations Officer 14 |
Overview of Procter & Gamble o P&G History o Facts & Figures o Purpose, Values & Principles o Company Structure o R&D Innovation o Careers o Q&A 15 |
Purpose, Values & Principles For 167 years, P&G's Purpose, Values and Principles (PVP) have been guiding the way we do business. Since the beginning, we've conducted our business focused on personal and professional ethics and principle-based management. The core of our PVP is personal integrity, respect for the individual and doing what is right long term. 16 |
Purpose, Values and Principles Our Purpose We will provide branded products and services of superior quality and value that improve the lives of the world's consumers. As a result, consumers will reward us with leadership sales, profit, and value creation, allowing our people, our shareholders, and the communities in which we live and work to prosper. 17 |
Purpose, Values and Principles Our Values P&G is its people and the values by which we live: o Leadership o Ownership o Integrity o Passion for Winning o Trust 18 |
Purpose, Values and Principles Our Principles o We show respect for all individuals o The interest of the company and the individual are inseparable o Innovation is the cornerstone of our success o We are externally focused o We value personal mastery o We seek to be the best o Mutual interdependency is a way of life o We are strategically focused in our work 19 |
Overview of Procter & Gamble o P&G History o Facts & Figures o Purpose, Values & Principles o Company Structure o R&D Innovation o Careers o Q&A 20 |
Company Structure Four Pillars GBU global business units Build major global brands with robust business strategies MDO market development organization Build local understanding as a foundation for marketing campaigns. GBS global business services Provide business technology and services that drive business success. CF corporate functions Work to maintain our place as a leader of our industries. 21 |
Company Structure Global Business Units Philosophy: Think Globally General Role: Create strong brand equities, robust strategies and ongoing innovation in products and marketing to build major global brands. Business Units: Global Beauty - Cosmetics, Deodorant, Feminine Care, Fine Fragrances, Hair Care, Hair Colorants, Personal Cleansing, Professional Hair Care, Skin Care 22 |
Company Structure Global Business Units Philosophy: Think Globally General Role: Create strong brand equities, robust strategies and ongoing innovation in products and marketing to build major global brands. Business Units: Global Household Care - Coffee, Commercial Products Group, Fabric Care, Home Care, Snacks 23 |
Company Structure Global Business Units Philosophy: Think Globally General Role: Create strong brand equities, robust strategies and ongoing innovation in products and marketing to build major global brands. Business Units: Global Family Health - Baby Care, Family Care, Oral Care, Personal Health Care, Pet Health and Nutrition, Pharmaceuticals 24 |
Company Structure Market Development Organizations (MDOs) Philosophy: Act Locally General Role: Interface with customers to ensure marketing plans fully capitalize on local understanding, to seek synergy across programs to leverage Corporate scale, and to develop strong programs that change the game in our favor at point of purchase. North America Latin America Western Europe Central and Eastern Europe, Middle East and Africa Greater China North East Asia Australasia, ASEAN, India 25 |
Company Structure Global Business Services Philosophy: Enabling P&G to win with Customers and Consumers General Role: Provide services and solutions that enable the company to operate efficiently around the world, collaborate effectively with business partners, and help employees become more productive. GBS Centers: o GBS Americas located in Costa Rica o GBS Asia located in Manila o GBS Europe, Middle East & Africa located in Newcastle 26 |
Company Structure Corporate Functions (CF) Philosophy: Be the Smartest/Best General Role: Ensure that the functional capability integrated into the rest of the company remains on the cutting edge of the industry. We want to be the thought leader within each CF. Corporate Functions: o Customer Business Development o External Relations o Finance & Accounting o Human Resources o Information Technology o Legal o Marketing o Consumer & Market Knowledge o Product Supply o Research & Development o Workplace Services 27 |
Company Structure Example: Pantene roll-out in US and Latin America Global Business Market Development Global Business Corporate Functions Who Units (GBUs) Organizations (MDOs) Services (GBS) (CF) What Define the equity/what Ensure Pantene excels Provides support - Support areas are a brand stands for in their region. Same GBS Center in Costa determined by (e.g. Pantene gives brand equity, but Rica serves both the business teams. CF you healthy, shiny different executions U.S. and Latin America. interacts as a hair) by region. consulting group, ready to provide A Pantene team within service if called the Beauty Care GBU upon. builds on the equity. How o Product initiatives/ Executions might vary: Services include: Services focus on: upgrades o U.S. might want large o Accounting o Ensuring each function o Marketing campaign size packaging for o Employee benefits is capitalizing on the communicating the Club Stores and payroll latest thinking or same fundamental o Latin America might o Order management methodologies for each benefit worldwide want the smallest and product logistics discipline o Manufacturing product possible package o Systems operations against global formula & package specs 28 |
Overview of Procter & Gamble o P&G History o Facts & Figures o Purpose, Values & Principles o Company Structure o R&D Innovation o Careers o Q&A 29 |
R&D Innovation P&G is an Innovation Leader o $1.8 billion in R&D annually o In the top 20 for R&D expenditure o 28,000 patents worldwide o One of the largest trademark holders in the world o Extensive know-how across multiple categories o 7,500 R&D resources, 1,200 PhDs o Recent product innovations include: Mr. Clean Auto Dry, Pampers Feel 'n Learn, Iams Savory Sauce, Pantene Color Expressions, Pampers Kandoo 30 |
R&D Innovation Defining Innovation Innovation is the blend of "what's needed" and "what's possible" 31 |
R&D Innovation What's Needed Starts with deep consumer understanding o Consumer-centric research methods both qualitative and quantitative o Define target consumers o Understand them demographically and psycho-graphically to get to their true unarticulated needs and desires 32 |
R&D Innovation What's Possible Product Innovation o Satisfies the unmet need o Recasts the category Cost Innovation o Not just cost savings o Provide a better brand experience at a lower delivered cost structure than what your competitor can do 33 |
R&D Innovation Connect + Develop What is "Connect + Develop?" Making the best use of both internal and external ideas o Connect across business units to facilitate innovation o Optimize value of P&G's IP through sale, license, alternate means of commercialization o Access external capabilities, products, technologies and business opportunities o Recent Connect + Develop products include Mr. Clean Magic Eraser, Olay Regenerist, Swiffer Duster, Glad Press 'n Seal, Crest Spin Brush 34 |
Overview of Procter & Gamble o P&G History o Facts & Figures o Purpose, Values & Principles o Company Structure o R&D Innovation o Careers o Q&A 35 |
Careers Employee Development "If you leave us our money, our buildings, and our brands, but take away our people, the company will fail. But if you take away our money, our buildings, and our brands but leave us all our people we can rebuild the whole thing in a decade." Richard R. Deupree P&G's Chief Executive from 1930-1948 36 |
Careers Career Functions o Administrative-General o Marketing o Consumer & Market Knowledge o Purchases o Customer Business Development o Research & Development o Customer Services/ Integrated Logistics o Workplace Services/ Corporate o Engineering o Facilities o External Relations o Plant Technician o Finance & Accounting o Management o Human Resources o Information Technology o Intellectual Property/Legal 37 |
Careers "Build From Within" Philosophy o As a result of this build from within philosophy, great emphasis is placed on training. o P&G is considered a development company because managers train their replacements every day, through on-the-job, formal classroom and web-based training 38 |
Careers "Build From Within" Philosophy o Each career is in the hands of the employee, with challenging responsibilities from the beginning. o There is an equal opportunity to succeed. o The "individual" approach helps to make the best use of skills, personality and diverse backgrounds for future success. 39 |
Careers P&G Success Drivers P&G Believes Having P&G people at their best is so important to us we embarked on extensive research to understand what P&G people do when they're at their best. We looked at the characteristics that have historically driven P&G growth. We looked outside the company, at what other best-in-class companies do to stay in the lead. We distilled all that we learned into three basic ideas that describe the competitive advantage of P&G people. 40 |
Careers P&G Success Drivers The Power of P&G Minds This is our ability, grounded in genuine respect for P&G competitors, to out-think, out-invent and out-play the best competitors over time for the benefit of consumers. 41 |
Careers P&G Success Drivers The Power of P&G People This is the competitive advantage that our people and people systems create when they work together. It's the power of one and value of all. 42 |
Careers P&G Success Drivers The Power of P&G Agility This is our ability to be fast, flexible, responsive and versatile in a complex and rapidly changing business environment. 43 |
Overview of Procter & Gamble o P&G History o Facts & Figures o Purpose, Values & Principles o Company Structure o R&D Innovation o Careers o Q&A 44 |
Questions? 45 |
Resources Please visit the P&G website to learn more about: P&G's Purpose, Values & Principles http://www.pg.com/jobs/company_culture/purpose.jhtml Success Drivers http://www.pg.com/jobs/recruitblue/succeeding.jhtml Research & Development http://www.pg.com/science/index.jhtml 46 |
Touching lives, improving life. P&G 47 |
FORWARD-LOOKING STATEMENTS
This document includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “anticipate,” “believe,” “expect,” “estimate,” “plan,” “outlook,” and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Investors are cautioned that such forward-looking statements with respect to revenues, earnings, performance, strategies, prospects and other aspects of the businesses of The Gillette Company (“Gillette”), The Procter & Gamble Company (“P&G”) and the combined company after completion of the proposed transaction are based on current expectations that are subject to risks and uncertainties. A number of factors could cause actual results or outcomes to differ materially from those indicated by such forward-looking statements. These factors include, but are not limited to, the following risks and uncertainties: those set forth in Gillette’s and P&G’s filings with the Securities and Exchange Commission (“SEC”), the failure to obtain and retain expected synergies from the proposed transaction, failure of Gillette and P&G stockholders to approve the transaction, delays in obtaining, or adverse conditions contained in, any required regulatory approvals, failure to consummate or delay in consummating the transaction for other reasons, changes in laws or regulations and other similar factors. Readers are referred to Gillette’s and P&G’s most recent reports filed with the SEC. Gillette and P&G are under no obligation to (and expressly disclaim any such obligation to) update or alter their forward-looking statements whether as a result of new information, future events or otherwise.
Additional Information and Where to Find It
This filing may be deemed to be solicitation material in respect of the proposed merger of Gillette and P&G. On May 27, 2005, Gillette filed with the SEC a definitive proxy statement on Schedule 14A, including the definitive joint proxy statement/prospectus constituting a part thereof. SHAREHOLDERS OF GILLETTE AND SHAREHOLDERS OF P&G ARE URGED TO READ THE DEFINITIVE JOINT PROXYSTATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS FILED OR THAT WILL BE FILED WITH THE SEC, AS THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. The final joint proxy statement/prospectus will be mailed to shareholders of Gillette and shareholders of P&G. Investors and security holders may obtain a free copy of the disclosure documents and other documents filed by Gillette and P&G with the Commission at the Commission’s website atwww.sec.gov, from The Gillette Company, Prudential Tower, Boston, Massachusetts, 02199-8004, Attention: Office of the Secretary, or from The Procter & Gamble Company, Investor Relations, P.O. Box 599, Cincinnati, OH 45201-0599.
Participants in the Solicitation
Gillette, P&G and their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies from their respective shareholders in respect of the proposed transactions. Information regarding Gillette’s directors and executive officers is available in Gillette’s proxy statement for its 2005 annual meeting of shareholders, which was filed with the SEC on March 30, 2005, and information regarding P&G’s directors and executive officers is available in P&G’s proxy statement for its 2004 annual meeting of shareholders, which was filed with the SEC on August 27, 2004. Additional information regarding the interests of such potential participants are included in the joint proxy statement/prospectus and the other relevant documents filed with the SEC when they become available.