Procter & Gamble agrees to add activist investor to board

CINCINNATI (AP) - Procter & Gamble is adding Nelson Peltz to its board of directors, ending a proxy battle with the activist investor who has been seeking to shake up the consumer products giant.

The announcement came after Peltz last month claimed to have won a shareholder vote to add him to the board, beating out incumbent director former Mexican President Ernesto Zedillo by a fraction of a percent. The company claimed, however, that the vote was too close to call.

On Friday, Cincinnati-based Procter & Gamble Co. said Zedillo and 10 others were re-elected. But it said that because Peltz had garnered so much shareholder support, he will be given a seat on the board starting March 1. Joseph Jimenez, the CEO of pharmaceutical company Novartis, was also added to the board.

Peltz's Trian Fund Management owns about $3.5 billion in P&G shares and has urged the maker of products like Pampers diapers, Tide detergent and Crest toothpaste to streamline its corporate structure and cut costs.

Procter & Gamble said it had "numerous discussions" with Peltz about the board seat leading up to Friday's announcement. It said they agreed the company should not to take on excessive debt, slash research and development spending or be broken up.