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Procter & Gamble's Billie Buyout to Boost Grooming Portfolio

Zacks Equity Research

The Procter & Gamble Company PG, also known as P&G, remains keen on boosting its women’s care portfolio. In sync with this, the company intends to buy a growing female body care company – Billie Inc. – for an undisclosed amount. Billlie is a subscription-oriented direct-to-consumer brand, catering to women’s beauty and grooming needs. The company offers quality shaving products and a premium body care range. Its portfolio comprises razors, shaving cream, body wash and body lotion.

The transaction is likely to be complementary to P&G’s existing female grooming portfolio, which includes the Venus, Braun and Joy brands. The company expects to benefit by combining its strong digital and direct-to-consumer marketing capabilities and a growing range of personal care products with the fresh, digitally-native brand, which appeals to Millennial and Gen Z consumers. Further, P&G expects Billie’s high-quality, naturals-focused razors and body care products to make its portfolio more dynamic.

Following the acquisition, Billie’s co-founders, Georgina Gooley and Jason Bravman, will continue to lead the brand’s operations.

As for Billie, the brand will benefit from P&G’s strong presence and ability to create global household brands. It expects P&G’s strong brand-building capabilities to help create a stronger brand for women.

In all, this combination is expected to further strengthen P&G’s grooming business and boost Billie.

P&G focuses on improving its product portfolio through strategic initiatives, which enable it to concentrate on its fast-growing businesses. For this, the company relies on its strategy of acquiring complementary businesses. Notably, it has acquired a private company — This Is L. — which produces period products with natural ingredients. This will aid in expanding its naturals product range, which is a key focus area for most day-to-day consumer product companies at present.

Some of its other acquisitions are the beauty brand – First Aid Beauty, the consumer health business of Germany-based Merck KGaA and Walker & Company brands in 2018.

These buyouts should bolster the company’s product portfolio in various categories.

We believe that P&G’s strong focus on enhancing brand portfolio through strategic acquisitions will expand customer base and aid productivity.

This Zacks Rank #2 (Buy) stock has gained 34.4% in the past year compared with the industry’s rise of 19.5%.


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