THE PROCTER & GAMBLE COMPANY
NEWS RELEASE One P&G Plaza
Cincinnati, OH 45202
FOR IMMEDIATE RELEASE
J.W. CHILDS ASSOCIATES, L.P. WILL PURCHASE P&G'S SUNNY D(R) AND PUNICA(R) BRANDS
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CINCINNATI, April 1, 2004 - The Procter & Gamble Company (NYSE:PG)
announced today it is selling the Sunny Delight and Punica Juice-based drink
businesses to J.W. Childs Associates, L.P., a Boston-based private equity firm.
J.W. Childs Associates, L.P. will operate Sundor Brands, Inc. under the name of
the Sunny Delight Beverages Company as a freestanding company to house these
businesses, which will be headquartered in Cincinnati. Terms of the transaction
were not disclosed.
The Sunny Delight Beverages Company will have more than $550 million in
annual sales, operate in eight countries across North America and Europe, own or
lease six manufacturing facilities and have approximately 700 employees. Ray
Rudy, an operating partner of J.W. Childs Associates, L.P., will be the Chairman
of the company and William B. Cyr, currently the vice president/general manager
of P&G's North America Juice-based drink business, will become the President &
CEO. Several other P&G managers will join the new company.
"This is a perfect arrangement for several reasons," commented P&G's
President of Global Snacks & Beverages Jorge Montoya. "First, J.W. Childs
Associates, L.P. has demonstrated the ability to grow midsize businesses to the
next level. Second, this transaction enables the vast majority of our employees
currently in the Juice-based drink businesses to have continued employment.
Finally, this fits with our intent to sell these businesses to an owner that has
beverages as a strategic priority, and it will allow us to focus on growing our
key billion-dollar Folgers(R) and Pringles(R) brands."
John W. Childs, founding partner of J.W. Childs Associates, L.P.,
commented, "We're extremely happy to be acquiring two leading Juice-based drink
brands in Sunny D and Punica. Both brands are growing, with good advertising,
strong future prospects, and a fantastic organization. We're obviously impressed
with the caliber of the people and the quality of the manufacturing facilities
we'll be inheriting."
As part of this transaction, P&G has agreed to provide transition
services for up to 12 months to allow for a smooth transition, and enable the
business to continue on its current growth trend without any major disruptions.
During this period, P&G will continue its current commercial relationship with
its customers.
Pending regulatory approval, closing of the transaction is expected in
the July-September quarter of 2004. Therefore, this transaction will have no
impact on P&G earnings per share in the current fiscal year, and the impact on
fiscal year 2005 earnings per share is not expected to be material as the gain
from the divestiture is expected to be reduced by the loss of contribution from
the business. There will, however, be quarterly impacts related to this
transaction throughout the next fiscal year as the divestiture is completed, the
remaining organization is right-sized, and the transition service is managed.
P&G will provide additional perspective on these quarterly impacts in the summer
of 2004 after the deal has closed and when guidance for the 2004/05 fiscal year
can be provided.
All statements, other than statements of historical fact included in
this release, are forward-looking statements, as that term is defined in the
Private Securities Litigation Reform Act of 1995. In addition to the risks and
uncertainties noted in this release, there are certain factors that could cause
actual results to differ materially from those anticipated by some of the
statements made. These include: (1) the ability to achieve business plans,
including growing existing sales and volume profitably despite high levels of
competitive activity, especially with respect to the product categories and
geographical markets (including developing markets) in which the company has
chosen to focus; (2) successfully executing, managing and integrating key
acquisitions (including Wella) and completing planned divestitures on expected
timing (including Sunny Delight and Punica), (3) the ability to manage and
maintain key customer relationships; (4) the ability to maintain key
manufacturing and supply sources (including sole supplier and plant
manufacturing sources); (5) the ability to successfully manage regulatory, tax
and legal matters (including product liability matters), and to resolve pending
matters within current estimates; (6) the ability to successfully implement,
achieve and sustain cost improvement plans in manufacturing and overhead areas,
including successful completion of the company's outsourcing projects; (7) the
ability to successfully manage currency (including currency issues in volatile
countries),interest rate and certain commodity cost exposures; (8) the ability
to manage the continued global political and/or economic uncertainty, especially
in the company's significant geographical markets, as well as any political
and/or economic uncertainty due to terrorist activities; and (9) the ability to
successfully manage increases in the prices of raw materials used to make the
company's products. If the company's assumptions and estimates are incorrect or
do not come to fruition, or if the company does not achieve all of these key
factors, then the company's actual results might differ materially from the
forward-looking statements made herein. For additional information concerning
factors that could cause actual results to materially differ from those
projected herein, please refer to our most recent 10-K, 10-Q and 8-K reports.
ABOUT SUNNY D AND PUNICA
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Originally created in Florida in 1964, Sunny D is a leading brand in
the US, Canada, Spain, Portugal, United Kingdom and France. Since acquiring
Sunny D in 1989, P&G has more than quadrupled the sales of the brand through
geographic expansion, new flavors and packages, and effective marketing. The
brand's line-up includes Tangy Florida Style(R), Smooth California Style(R),
Tropical Punch Caribbean(R), a calcium fortified version, no added sugar
variants, Lemonade and a variety of sizes, including the fast selling 333ml Big
D(R) sports bottle.
Punica is a leading brand sold primarily in Germany. Since acquiring
Punica in 1984, P&G has more than tripled the sales of the brand through several
innovations, including the launch of Schorle and Tea and Fruit flavors, and PET
packaging forms.
ABOUT P&G
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Two billion times a day, P&G brands touch the lives of people around
the world. The company has one of the largest and strongest portfolios of
trusted, quality brands, including Pampers(R), Tide(R), Ariel(R), Always(R),
Whisper(R), Pantene(R), Bounty(R), Pringles(R), Folgers(R), Charmin(R),
Downy(R), Lenor(R), Iams(R), Crest(R), Actonel(R), Olay(R) and Clairol Nice `n
Easy(R). The P&G community consists of nearly 98,000 employees working in almost
80 countries worldwide. Please visit WWW.PG.COM for the latest news and in-depth
information about P&G and its brands.
ABOUT J.W. CHILDS ASSOCIATES, L.P.
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J.W. Childs Associates, L.P. is a private equity investment firm based
in Boston specializing in leveraged buyouts and recapitalizations of
middle-market growth companies in partnership with management. The firm is
focused on acquiring companies in the consumer products, health care and
specialty retail industries. Since 1995, J.W. Childs Associates, L.P. managed
investment vehicles have invested in 27 companies with a total transaction value
of over $6.5 billion. Current portfolio companies include American Safety Razor,
Esselte, Hartz Mountain Corporation, The Meow Mix Company, The Nutrasweet
Company and Pinnacle Foods.
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P&G MEDIA CONTACTS:
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MEDIA US
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Gary Dowdell - Snacks & Beverages 1-(513) 983-8172
INVESTOR RELATIONS
Thomas Tippl 1-(513) 983-2414
P&G CORPORATE MEDIA CENTER:
US media call: 1-(866) PROCTER (1-866-776-2837)
Media outside the US call: +1-(513) 945-9087
MEDIA EUROPE
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UK
Sally Woodage - Press office +44 191 297 6262
SPAIN & PORTUGAL
Rafael Mazon +34 91 722 24 98
Belen Carazo +34 91 722 24 86
FRANCE
Anna Gallais +33 1 40 88 5686
GERMANY
Detlef Schermer + 49 6196 89 43 69
Petra Popall + 49 6196 89 61 26
SWITZERLAND
Irene Kaempfen + 41 22 709 75 93
EUROPEAN NEWS OFFICE
Andrew Fisk - Corporate +32 2 456 5656
OTHER MEDIA CONTACTS
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J.W. CHILDS ASSOCIATES, L.P. CONTACT
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Adam Suttin 1-(617) 753-1100
SUNNY DELIGHT BEVERAGES COMPANY
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Billy Cyr 1-(513) 983-5531
Rick Zimmerman 1-(513) 983-5800