This Day In Market History: Gillette Buys Duracell
Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.
What Happened
On this day 22 years ago, Gillette bought Duracell for $7 billion.
Where The Market Was
The Dow Jones Industrial Average closed at 5,838.52 and the S&P 500 traded at 680.54. Today, the Dow is trading at 25,998.92 and the S&P 500 is trading at 2,888.92.
What Else Was Going On In The World
In 1996, a bomb exploded at the Summer Olympics in Atlanta. DVDs were launched in Japan. Average monthly rent was $554.
Gillette’s Duracell Blunder
When Gillette announced it was buying Duracell for $7 billion in stock in September 1996, Gillette’s share price was hovering around $61. At the time of the deal, Gillette was making a push to become a diversified consumer products company, but the Duracell deal didn’t exactly work out as planned.
After the diversification strategy failed to bear fruit, Gillette itself was acquired by Procter & Gamble Co (NYSE: PG) in 2005 in a deal worth roughly $54 per Gillette share at the time.
In 2014, nearly two decades after Gillette paid $7 billion for Duracell, Berkshire Hathaway, Inc. (NYSE: BRK-A) (NYSE: BRK-B) bought Duracell from Procter & Gamble at a roughly 50-percent discount to Gillette’s 1996 price. The sale was part of Procter’s initiative to shed its slower-growing brands and focus on roughly 80 core brands.
As of 2016, Duracell generated an annual revenue of roughly $2 billion.
Related Links:
This Day In Market History: Electronic Data Systems Goes Public
What Is The Buffett Indicator?
See more from Benzinga
Vertical Group's Gordon Johnson On Solar Stocks, Steel Prices And Tesla's 'Potential Crisis'
This Day In Market History: Electronic Data Systems Goes Public
Goldman Downgrades Lam Research, Eyes Downturn In Memory Market
© 2018 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
