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Pet Food News
On April 11, 2014

Mars to buy P&G petfood brands for US$2.9 billion

Deal expected to finalize in second half of year

Mars Inc. is set to purchase Procter & Gamble's petfood brands, including Iams, Eukanuba and Natura, for US$2.9 billion, according to reports. P&G is leaving the pet care market to focus more on its core brands, and the transaction will solidify Mars as the world's biggest petfood company.

Mars did not take on P&G's European business, but it has an option to buy operations in remaining markets in Asia and Africa, said P&G spokesman Paul Fox. The company plans to actively pursue the sale of its European pet care business, he said.

"The announced deal is not a surprise in view of P&G’s declining share," said Paula Flores, head of Euromonitor International's Pet Care division. "P&G is the fourth global player with a global value share 3.6%, down from 4.2% in 2008. Despite the good position in the premium segment of the North American dog and cat food market, where it accounts for 19% of value sales in 2012, this figure stood at 24% as recently as 2008. The company faced two voluntary recalls for its superpremium Natura, Iams and Eukanuba brand during 2013. Moreover P&G has a weak performance in most emerging markets."

The deal is expected to be complete in the second half of the year.

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