David Taylor, former CEO of Procter & Gamble Co.
is joining Clayton Dubilier & Rice LLC as a senior operating advisor, officials at the private equity firm said.
Mr Taylor stepped down as CEO of the consumer products company last November after a more than 40-year career there, but remained executive chairman. He will hand over this role to his successor as CEO, Jon Moeller, before joining CD&R on July 1.
Based in New York, CD&R has long used a model of pairing investment professionals with business management experts – known as operating partners or advisors – to buy companies and try to improve their performance. .
Mr Taylor will join a list of senior executives who have come to the private equity firm from US companies, including John Compton, a former PepsiCo Inc.
Chairman, and Sandra Peterson, formerly Group Global Chairman at Johnson & Johnson.
Operating partners have been known to step in and lead portfolio companies on an interim basis, such as Mr. Compton’s recent stint at the helm of CD&R-owned pet products maker Radio Systems Corp.
CD&R, which manages about $57 billion, is trying to raise at least $20 billion for its next fund, The Wall Street Journal reported.
The firm was founded in 1978 by Joseph Rice, Martin Dubilier and Eugene Clayton. Mr. Rice came from investment banking, while MM. Dubilier and Clayton had worked as business executives and management consultants. The three, according to the company, determined that finding a way to combine their collective skills was more important than financial engineering when it came to achieving sustainable performance in the buyout business.
Today, the company derives more than 80% of its returns from operational improvements at its portfolio companies, with the rest coming from adjusting capital structures and other factors, said CD&R chief executive Nate Sleeper. .
Mr. Taylor, 64, during his tenure at P&G has held executive positions in operations and marketing, managed manufacturing sites and led various consumer brands in North America, Europe and Asia.
He took over as CEO in 2015 as P&G struggled to grow in the post-recession years. Sales initially slowed even further, leading to a proxy battle with activist investor Nelson Peltz, who served for a time on the company’s board.
Mr Taylor doubled down on flagship P&G brands including Tide and Gillette, ignoring those who said the company should reduce its reliance on them and invest in e-commerce startups. His strategy worked, especially during the pandemic, when consumers flocked to the most well-known names.
Mr Taylor said he did not initially consider going into private equity, but was attracted to the CD&R model.
“That focus on operational excellence and the value they place on someone with my experience surprised me a bit,” he said. “It’s the power of diverse thinking, and they understand it.”
Write to Miriam Gottfried at Miriam.Gottfried@wsj.com
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