P&G creates new company for the Folgers Coffee brand
CINCINNATI Proctor & Gamble announced plans to separate its coffee department into an independent company, which will be named The Folgers Coffee Co. The company will have four different locations, one of which will also be the headquarters in Cincinnati, Ohio. It will employ 1,250 employees, adding to what P&G feels is, according to published reports, “good for the coffee business, as the business will get greater priority and attention as a standalone company”
This new venture has been put in place as a result of its major earnings in 2007, which include sales of about $1.6 billion. By separating the coffee business as its own independent company, P&G is hoping to make Folgers, which is the leading retail coffee brand in North America, the focus of its own company. As A.G. Lafley, chairman of the board and chief executive officer stated, “This separation allows us to focus on our core businesses and The Folgers Coffee Co. to further develop and leverage its brand portfolio in a coffee-specific business model.”
To start off Folgers’ new business venture, P&G has named Jamie Egosti, current president of P&G’s Coffee and Global Snacks division, chief executive officer of The Folgers Coffee Co. The split of P&G and Folgers is set to be completed between July and December 2008, but will not do so until the company decides the form of separation, which would be either a spin-off or split-off transaction. The final decision for the two separation options will be finalized during the April-June 2008 quarter.