City doubts Rentokil disposals will go ahead

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The Independent Online

Rentokil shares fell yesterday on the growing expectation that the support services company will not announce a significant disposals programme next week.

Rentokil shares fell yesterday on the growing expectation that the support services company will not announce a significant disposals programme next week.

While the company declined to comment, industry sources believe that it will say that it has decided not to sell its conferences and parcels delivery businesses when it announces the results of a review next week.

These divestments were the strategy favoured by Sir Clive Thompson, the founder, who was chairman until he was ousted in a spectacular boardroom coup earlier this year. Sir Clive had argued that the money raised from these sales could then be used to grow the group's core businesses - contract cleaning and pest control.

Some City commentators have called for an even more radical strategy that would see the whole group broken up. However, that seems remote.

Rentokil shares closed 2 per cent lower at 153.5p yesterday, having been down to 148.75p in earlier trading.

Deutsche Bank analysts said the most obvious hindrance to disposals was the lack of a chief executive to make decisions and formulate a long-term strategy. Rentokil dumped its chief executive James Wilde last month, just weeks after Sir Clive was dispatched.

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