Reckitt agrees £2.5bn deal for SSL

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The Independent Online

Vanish-to-Cillit Bang giant Reckitt Benckiser has agreed a £2.5 billion deal to snap up the consumer goods group behind Durex and Scholl footcare, it was announced today.

Reckitt will pay 1163p per share for SSL International under the takeover, as well as honouring the final dividend due for SSL investors.

Anglo-Dutch group Reckitt said the takeover would provide a significant boost to its health and personal care arm, increasing the division's net revenues by 36% to around £2.8 billion, or a third of total group sales.

But the groups warned that the integration of the two companies is expected to lead to job cuts in commercial and administration functions.

SSL employs around 10,000 people worldwide.

SSL, which also has pain relief brands such as Cuprofen and Paramol, is headquartered in London and has UK sites and manufacturing bases in Manchester, Peterlee in County Durham, Redruth in Cornwall, and Middleton.

Reckitt's offer represents a 32% premium on SSL's 882p share price at last night's close.

But SSL chairman Gerald Corbett said the offer was "some four times the level of SSL's share price five years ago".

"I believe few shares in investors' portfolios have done as well. Reckitt Benckiser is a well-regarded company and I am sure our brands and people are in good hands," he said.

SSL has operations in more than 30 countries, with manufacturing in India, Thailand and China, in addition to its UK sites.

The group saw pre-tax profits leap 51% to £115.3 million in the year to March 31 as sales soared, thanks to growth in burgeoning markets such as China - a market in which Reckitt wants to expand.

Reckitt has long said it would look to make acquisitions in the health and personal care market and said today SSL would make a good fit.

Based in Slough, Reckitt employs around 24,900 staff globally and has a stable of well-known household brands, such as Dettol and Strepsils.

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