Rentokil completes €410m France Workwear sale; proceeds to cut debt

Rhea-AI Filing Summary

Rentokil Initial has completed the sale of its France Workwear business to H.I.G. Capital for an enterprise value of €410m (c.$480m) on a cash-free, debt-free basis, including an earn-out of up to €30m (c.$35m) tied to 2026 performance. Total net cash proceeds are expected to be around €370m (c.$435m), subject to the final earn-out outcome. Proceeds will be deployed according to Rentokil's balanced model: reducing debt, funding organic investment in the core business, and pursuing complementary bolt-on M&A.

The company says the disposal further streamlines Rentokil into a Pest Control and Hygiene & Wellbeing group, lowering annual capital expenditure needs and improving cash conversion margin by about 100 basis points. After completion, revenue mix is expected to be roughly 85% Pest Control and 15% Hygiene & Wellbeing. France Workwear was reported as a discontinued operation in HY25 and in FY24 generated $324m of revenue, $57m of adjusted operating profit and had $93m of capital expenditure.

Positive

• Completed disposal of non-core asset for €410m enterprise value, unlocking ~€370m net cash proceeds
• Expected ~100 basis point improvement in cash conversion margin due to lower capex
• Clearer strategic focus with pro forma revenue mix of ~85% Pest Control and ~15% Hygiene & Wellbeing
• Proceeds allocated to deleveraging and growth consistent with the company's balanced model

Negative

• Final proceeds contingent on up to €30m earn-out tied to 2026 performance
• Filing lacks pro forma leverage and explicit uses of proceeds with numerical targets
• Transaction reduces diversification by exiting the Workwear segment, concentrating revenue risk

Insights

M&A Specialist

TL;DR: The divestment monetizes a non-core asset, strengthens the balance sheet, and sharpens strategic focus on higher-margin core services.

The sale at €410m enterprise value with expected net cash proceeds of ~€370m materially reduces capital intensity for Rentokil and provides immediate liquidity for deleveraging and targeted reinvestment. The stated ~100bp improvement in cash conversion margin and a shift to ~85% Pest Control revenue mix indicate clearer operational focus and potentially higher recurring cash flows. The €30m earn-out aligns seller and buyer on near-term performance, but final proceeds depend on 2026 results. For acquirers, H.I.G. gains a business with FY24 revenue of $324m and $57m adjusted operating profit, suggesting mid-single-digit operating margins before synergies or restructuring.

Financial Analyst

TL;DR: Transaction is balance-sheet positive and simplifies Rentokil's capital allocation, though proceeds are contingent on an earn-out.

The company will receive ~€370m net cash proceeds subject to earn-out, which management says will be used to reduce leverage and fund growth. Removing a business that had $93m of FY24 capex will materially lower capital expenditure needs and could improve free cash flow conversion. The classification of France Workwear as discontinued operations formalizes the exit for reporting clarity. Missing from the filing are pro forma leverage metrics and explicit targets for post-deal net debt or planned M&A sizing, which would help quantify the balance-sheet impact.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

___________________

FORM 6-K

__________________

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of September 2025

Commission File Number: 001-41524

___________________________________

Rentokil Initial plc

(Registrant’s name)

___________________________________

Compass House

Manor Royal

Crawley

West Sussex RH10 9PY

United Kingdom

(Address of principal executive office)

_____________________________________

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

Completion of France Workwear business sale dated 30 September 2025

30 September

Rentokil Initial completes sale of France Workwear business to H.I.G. Capital

Rentokil Initial plc (the "Company") is pleased to confirm the completion of the sale of its Workwear business in France to H.I.G. Capital, as first announced in May 2025. The sale values the business at an enterprise value of €410m (c.$480m), on a cash-free and debt-free basis, including an earn-out of up to €30m (c.$35m) based on the performance of the business in 2026.

Total net cash proceeds from the transaction are expected to total €370m (c.$435m), subject to final earn-out outcome. Proceeds will be allocated in-line with the balanced Rentokil Initial model, distributed towards deleveraging of the balance sheet, organic growth focused investment in the core business, and complementary bolt-on M&A activity.

The transaction is a continuation in the positioning of Rentokil Initial as a streamlined Pest Control and Hygiene & Wellbeing business, reducing annual capital expenditure requirements and benefitting cash conversion margin by c.100 basis points. Following completion, the Group's revenue mix will comprise c.85% Pest Control and c.15% Hygiene & Wellbeing.

Looking ahead, the sale enables the Company to concentrate resource on the large, attractive long-term growth opportunities within its core markets. 

Andy Ransom, Chief Executive of Rentokil Initial plc said:

"The completion of the Workwear sale is of strategic significance for us, as we execute on our ongoing strategy to focus on our market leading, core businesses. The transaction is value accretive for our shareholders, as we strengthen our balance sheet, streamline capital efficiency, and improve cash generation, with a simplified business.

"I would like to thank our France Workwear colleagues for their commitment throughout the process, and wish all at the company well as it moves forward with H.I.G."

Enquiries:

Investors / Analysts: Heather Wood, Rentokil Initial, +44 7808 098793

Media: Malcolm Padley, Rentokil Initial plc, +44 7788 978199

Note: France Workwear was classified within "Discontinued Operations" in HY25 financials and will be similarly referred to at FY25. In FY24, France Workwear, including flat linen textile and clean room business, generated Revenue of $324m, Adjusted Operating Profit of $57m and had associated capital expenditure of $93m.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: 30 September 2025	RENTOKIL INITIAL PLC
	/s/ Rachel Canham
	Name: Rachel Canham
	Title: Group General Counsel and Company Secretary

FAQ

What did Rentokil (RKLIF) sell in this Form 6-K?

Rentokil sold its France Workwear business to H.I.G. Capital for an enterprise value of €410m including an earn-out of up to €30m.

How much cash will Rentokil receive from the sale?

Total net cash proceeds are expected to be approximately €370m (c.$435m), subject to the final earn-out outcome.

How will Rentokil use the proceeds from the sale?

Proceeds will be allocated according to Rentokil's balanced model: deleveraging, organic investment in the core business, and complementary bolt-on M&A.

What was the size and profitability of France Workwear?

In FY24 France Workwear generated $324m revenue, $57m adjusted operating profit, and had $93m capital expenditure.

How does the sale affect Rentokil's business mix?

Following the sale, Rentokil's revenue mix is expected to be approximately 85% Pest Control and 15% Hygiene & Wellbeing.