Procter & Gamble Co's (PG.N) independent directors said the board supports Chief Executive Bob McDonald and his turnaround plan, while William Ackman confirmed his stake in the world's largest household products company is worth about $1.8 billion.
The board action came nearly a week after Ackman, the activist investor, revealed that his Pershing Square Capital Management took a stake in the maker of Tide detergent and Pampers diapers.
"The board is overseeing a plan to return P&G results to levels that produce the best long-term value for shareholders; unanimously supports the plan and Chief Executive Officer, Bob McDonald, as he leads its implementation; and is monitoring its effectiveness," they said in a filing with the U.S. Securities and Exchange Commission on Wednesday morning.
Hours later, Ackman told CNBC's Delivering Alpha conference that Pershing's stake is worth about $1.8 billion, plus some options. That gives his firm roughly a 1 percent stake in P&G.
It is "very hard" to lose money in P&G at the current share price or the price Pershing paid, "which is below the current share price," Ackman said at the New York event, which was also broadcast on the cable news channel. He added that he looks forward to meeting P&G's CEO.
P&G, which is in the midst of a $10 billion restructuring and other changes, declined to make board members available for interviews.
Ackman has been instrumental in shaking up management at other companies, including Canadian Pacific Railway Ltd (CP.TO) and J.C. Penney Co Inc (JCP.N).
Pershing Square told investors this week it recently sold its position in Citigroup Inc (C.N) and used that money to buy P&G shares.
Ackman's interest in P&G was disclosed on July 12. Cincinnati-based P&G's shares rose 3.7 percent on July 12 and another 2.2 percent on July 13.
News of Ackman's investment in P&G came weeks after a June 20 speech, during which McDonald cut P&G's fourth-quarter profit and sales forecasts and outlined a plan to focus on its 40 biggest businesses, 20 biggest new products and 10 key developing markets.
At that time, McDonald said it would take time to reverse the negative trends and he expected little improvement in fiscal 2013, which began on July 1.
"I think we'll know whether the strategy change is working within the next few quarters," said Morgan Stanley analyst Dara Mohsenian, who has an "equal weight" rating on P&G.
"It is going to be difficult to turn the fundamentals around given that they operate at large price premiums in the categories they're in and given they skew to developed markets" where the consumer is weak right now. "I think those are going to be hard issues for them to overcome."
P&G's board consists of 10 independent directors and Chairman, President and CEO Bob McDonald, who joined the board and became the company's leader in 2009.
James McNerney, the chairman, president and CEO of Boeing Co (BA.N), is presiding director of the P&G board.
P&G shares rose 3 cents to $64.82 on the New York Stock Exchange. P&G shares closed at $61.40 on July 11, the day before Ackman's investment was reported.
(Reporting by Jessica Wohl in Chicago and Svea Herbst-Bayliss and Martinne Geller in New York; editing by Gerald E. McCormick, Carol Bishopric and Andre Grenon)