Thursday, July 17, 2003

P&G says juice drinks may be shed

By Cliff Peale
The Cincinnati Enquirer

In a widely expected move, Procter & Gamble Co. said Wednesday it would consider selling its Sunny Delight and Punica juice drinks.

P&G's juice brands have struggled for years as the Cincinnati-based company moved more into health-care and beauty-care brands. Sunny Delight would be joining a growing list of former P&G icons that have been sold.

Those include Crisco shortening, Jif peanut butter, Duncan Hines cake mix and Comet household cleaner.

If a sale happens, it will have scant impact on the Tristate. Most of the 950 employees are in plants outside the region, with "very few" at P&G's downtown headquarters, a spokesman said.

It's not P&G's first attempt at divesting Sunny Delight. In 2001, it agreed with Coca-Cola Co. to contribute Sunny Delight and Pringles to a new company with Coke brands including Minute Maid.

But that deal collapsed, and P&G has been considering options.

In a conference call with Wall Street investors in January, chairman and chief executive A.G. Lafley said the juice business was struggling and hinted that P&G might not wait long before taking action.

Sunny Delight's market share has fallen to 4.9 percent from 8.5 percent at year-end 1998, according to market-tracker Information Resources Inc. Those results do not include sales from Wal-Mart, P&G's biggest retail customer.

Sunny Delight and Punica, sold mostly in Germany, totaled sales of about $550 million last year. Those sales were down slightly from the year before, but both brands were profitable, a P&G spokesman said.

Sunny Delight was created in 1964 and acquired by P&G in 1989. The company bought Punica in 1984.


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