Rentokil Initial, the business services group, pressed on with its disposal programme yesterday with the £320m sale of its American plant-hire business to Ashtead, the UK plant-hire company.
Rentokil, whose shares have plunged in the past 18 months after a series of profits warnings, said the proceeds would be used to fund its £1.5bn share buyback programme.
Sir Clive Thompson, Rentokil's chief executive, said the deal put Rentokil on track to realise £600m-£700m from its disposal plans, which will see it sell businesses in distribution, UK plant-hire and personnel services.
The US plant-hire business is one of the larger divisions of the old BET group acquired by Rentokil in 1996. However, Sir Clive warned that the UK plant hire business would not attract a similarly high rating. BET USA has 60 plant-hire branches in 22 states. It recorded profits of $48m last year. Ashtead will pay £186m in cash plus £134m in convertible shares, equivalent to Ashtead shares at 150p per share. Rentokil shares ended up 14.25p to 174.5p, amid signs of further buybacks yesterday. Ashtead shares fell 7p to 98p.Reuse content