LONDON – In a move that will dramatically reshape the pest control industry, Rentokil Initial announced on Tuesday it will buy Terminix Global Holdings for $1.3 billion in cash and 643.3 million new Rentokil Initial shares in a deal that values the U.S. company at $6.7 billion. The deal is expected to close in the second half of 2022, subject to approval by Rentokil Initial and Terminix shareholders, as well as regulatory approval.
The acquisition represents Rentokil’s largest North America acquisition, bringing together 56,000 colleagues in more than 87 countries, serving 4.9 million customers, Rentokil reports.
Rentokil CEO Andy Ransom, in the Rentokil Initial announcement, said, "This is an exciting and transformational combination that will create the global leader in commercial, residential and termite pest control and a leader in North America, the world's largest pest control market.”
In a Terminix press release, the company said combining Terminix’s position in residential and commercial pest management services in the U.S., with Rentokil Initial’s strong international operations and global commercial pest control offerings is a “win-win for our teammates, customers, partners and shareholders.”
Terminix CEO Brett Ponton said, "These are two highly complementary businesses with a similar operational playbook focused on supporting great people to provide outstanding customer service across Pest Control and Hygiene & Wellbeing. The combination will deliver further investment and the sharing of best practices to enable our talented teams to better serve customers, protecting them from the growing threat of pests and meeting their future needs. We will open our first innovation center in the U.S. and provide our industry-leading innovations and digital technologies to a far larger customer base. This is a win-win-win for colleagues, customers and shareholders."
Naren Gursahaney, chairman of Terminix, added, "On behalf of the Board of Terminix, I enthusiastically support this complementary combination of two phenomenal pest management companies. Our Board of Directors is confident that Rentokil Initial is the perfect partner for Terminix and that this transaction will maximize value for Terminix's customers, teammates and stockholders. The transaction delivers a compelling 47% premium for Terminix's stockholders, and the equity consideration will allow Terminix stockholders to participate in and benefit from the substantial upside potential of the combined company.”
Barclays and Goldman Sachs acted as Rentokil’s financial advisors, while Lazard advised Terminix.
Source: PCT Online
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