Report: P&G's McDonald to succeed Lafley

CINCINNATI -- Media reports say people familiar with the matter revealed the plan for Lafley to step aside as chief executive officer in favor of McDonald while staying on as chairman.

"It is a very deliberate and well-planned process, years in the formation, and we're not expecting to be making any announcements," P&G spokesman Paul Fox told The Associated Press before a regularly scheduled board meeting at company headquarters in downtown Cincinnati.

P&G makes brands such as as Tide detergent, Gillette shavers and Pampers diapers.

McDonald, P&G's chief operating officer, has been considered heir apparent to Lafley, who became CEO nine years ago this month and turns 62 on June 13.

"It's not unexpected that Bob McDonald was going to be named CEO," said Ali Dibadj, a senior analyst for Sanford C. Bernstein. "I think he's an extraordinarily capable leader."

But Dibadj said the move will raise questions — if it happens — during a recession as P&G's growth and sales have slumped.

"If this is for real, investors will have questions about the timing of the departure and what is A.G. Lafley leaving behind for McDonald," he said.

P&G has seen nearly a decade of double-digit growth and the acquisition in 2005 of Gillette in a blockbuster $57 billion deal that added Gillette's shavers, Duracell batteries and Oral-B tooth care to P&G's household portfolio.

But the company's sales and profits have slowed the past year as households limit spending and trade down to less-expensive brands. P&G on May 28 forecast that earnings and sales growth will fall below the company's usual 4% to 6% targets for this year and next.

The 55-year-old McDonald is a veteran of the Asian businesses that P&G has increasingly targeted for growth. He has worked closely with Lafley on P&G strategy and analysts have said his leadership would be unlikely to mean significant shifts in direction for the company.