Crawley-based Rentokill Initial makes £5billion acquisition of large American business to create global leader in pest control

Rentokil Initial will acquire Terminix for stock and cash and the transaction will bring together two complementary businesses to create the global leader in pest control and hygiene and wellbeing, and the leader in the pest control business in North America, the world's largest pest control market.

The transaction will also combine two leading brands with a long cultural heritage, outstanding talent and strong focus on people, customers and ESG.

Earlier this year, Rentokill Initial moved their global HQ to Crawley, taking 3x the space they had in the building on Manor Royal. They also have their global innovation centre in Manor Royal.

Upon completion, the Combined Group will have circa 56,000 colleagues serving irca 4.9m customers around the world from 790 locations.

The enlarged business will have a strong platform for growth, particularly in North America, and an attractive financial profile to support future growth, including through acquisitions and continued investment in innovation and technology.

The Combination is expected to create significant value, enhance long-term growth potential, be highly cash generative and present a compelling industrial logic, supported by:

- increased scale and leadership in the global pest control market;

- substantially increased scale in North America, providing an enlarged platform for profitable growth;

- a complementary and synergistic portfolio combination; and

- an attractive financial profile.

Richard Solomons, Chairman of Rentokil Initial, said:"The Board of Rentokil Initial and I are delighted to recommend this transformational combination which will create the global leader in Pest Control and Hygiene & Wellbeing.

"Under Andy Ransom's leadership, our Combined Group will have a highly talented and experienced management team able to more effectively create value and enhance long-term growth. We believe the combination is a compelling opportunity for all stakeholders to participate in the value creation of the Combined Group."

Andy Ransom, CEO of Rentokil Initial, 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. It brings together c.56,000 colleagues, protecting people, enhancing lives in over 87 countries, and serving c.4.9m customers.

"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 centre in the US 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, said: "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 47.0% 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. The Terminix Board of Directors has unanimously determined that this highly complementary combination is a win for, and in the best interests of, all of our stakeholders. The combined company will be differentiated by its strong focus on people, customers and ESG and well-positioned to drive continued growth and value creation."