28 Feb 2014 07:02
28 February, 2014
Rentokil Initial announces the sale of Initial Facilities
Rentokil Initial plc (FTSE: RTO, "the Company") announces today that it has agreed the sale of its Initial Facilities ("IFS") business to Interserve Plc for a total cash consideration of £250m. Completion, which is subject to the agreement of Interserve's shareholders at a General Meeting on 17 March, is expected by the end of March 2014.
In 2013 Rentokil Initial indicated that Initial Facilities was a non-core business for the Company. Its disposal, following that of City Link last year, will enable Rentokil Initial to focus on its three core route-based categories of Pest Control, Hygiene and Workwear. Excluding Initial Facilities, the Company's total revenue for the year ended 31 December 2013 was £1.76bn.
Post disposal the underlying financial metrics of Rentokil Initial will be significantly enhanced:
*Actual 2013 (incl. IFS) Proforma 2013 (excl. IFS)
Net operating margin 11.2% 13.1%
Organic growth -1.2% +0.5%
APBITA growth +4.1% +6.4%
* (at Constant Exchange Rates)
Initial Facilities delivered adjusted operating profit of £25.8m on revenues of £534.0m for the year ended 31 December 2013. The business has gross assets of £229.6m.
Andy Ransom, Chief Executive of Rentokil Initial Plc, said:
"This transaction really is a 'win win win'. It is an excellent outcome for our colleagues and customers in Initial Facilities, it represents a great opportunity for Interserve and it is absolutely the right deal for Rentokil Initial and its shareholders.
"Proceeds from the sale will be used primarily to pay down debt. We are now in a terrific position to focus capital and resources on our core route-based categories of Pest Control, Hygiene and Workwear, and over time we will also look to make further acquisitions in these core businesses."
-- Ends --
Notes to Editors
Preliminary Results for the year ended 31 December 2013
A presentation for investors and analysts will be held on Friday 28 February 2014 at 8.45am at the Inmarsat Conference Centre, 99 City Road, London, EC1Y 1AX. This will be available via a live audio web cast at www.rentokil-initial.com.
Rentokil Initial:
Rentokil Initial is one of the largest business services companies in the world, operating in over 60 countries. The company offers route-based services including pest control, hygiene and workwear through teams of local experts.
www.rentokil-initial.com
Enquiries:
Investors / Analysts enquiries:
Katharine Rycroft, Investor Relations Rentokil Initial plc 07811 270 734
Media enquiries:
Malcolm Padley, Corporate Communications Rentokil Initial plc 07788 978 199
Justine McIlroy / Nina Coad / Oliver Hughes Brunswick Group 020 7404 5959