Procter & Gamble to Invest in Boston
Wednesday January 10, 5:25 pm ET
By Mark Jewell, AP Business Writer
Procter & Gamble to Invest in Boston, Realign Gillette Business
BOSTON (AP) -- Procter & Gamble Co. on Wednesday said it will invest $35 million to $50 million in a Gillette manufacturing center in South Boston, on top of a $200 million commitment P&G made nearly two years ago to upgrade the century-old plant.
Cincinnati-based P&G also announced a reorganization to shift units gained in its 2005 acquisition of Gillette Co. into existing P&G divisions. P&G has operated a separate Gillette global business unit since the $57 billion acquisition was completed in October 2005.
P&G said its latest investment at the 33-acre site in South Boston would improve office space, lobby and meeting areas, training rooms, a cafeteria, and an employee fitness center.
Employees at the former Gillette corporate headquarters in the 52-story Prudential Tower in Boston's Back Bay section will move to the South Boston plant when the Prudential lease expires in 2009, P&G said.
The South Boston plant, which bears a large sign proclaiming itself "World Shaving Headquarters," will house the Gillette groups for research and development engineering, manufacturing and marketing groups.
The moves come nearly two years after P&G announced a $200 million investment in South Boston.
That announcement was welcomed by many Boston area politicians who had earlier criticized P&G's acquisition of Gillette, citing job cuts and a loss in local corporate clout.
One of those politicians, Boston Mayor Thomas Menino, also applauded Wednesday's announcement and called P&G "a responsible employer."
"They are a terrific partner and an example of how Boston's mission to attract and retain world class companies is working to lead our city forward," Menino said in a statement.
Under the reorganization taking effect in July, the Gillette razor and blade and Braun shaver businesses will become part of P&G's Beauty and Health division, with the Duracell battery brand once owned by Gillette joining P&G's Household Care unit.
P&G has said it expects to cut 5,000 to 6,000 jobs over the two-year integration of Gillette into P&G, which has a work force of about 140,000.
The deal created a consumer products powerhouse that combined P&G brands such as Tide detergent, Crest toothpaste and Charmin toilet paper with Gillette's shaving products, batteries and oral health businesses.
Shares of Procter & Gamble rose 76 cents, or about 1 percent, to close at $64.24 on the New York Stock Exchange.
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