British business services company Rentokil Initial Plc announced an offer from US conglomorate United Technologies Corporation for its electronic security division. UTC’s cash offer values Initial Electronic Security Group (“IESG”) at £595m. 

Closing of the transaction is conditional upon a limited number of items including regulatory approvals and consultations with employee works councils in France and the Netherlands. These will be sought and take place over the next several weeks with a view to completing a transaction before the end of June. Proceeds will be used to reduce debt. 

Doug Flynn, Chief Executive of Rentokil Initial, commented "This offer for our electronic security businesses represents good value for Rentokil Initial shareholders. 

“Over the past 18 months we have been actively reshaping Rentokil Initial’s business portfolio, investing particularly in businesses where we have or can achieve market leading positions. We have therefore made successful acquisitions in pest control and parcel delivery and in our Asia Pacific businesses and sold businesses in conferences and manned guarding. Completing this transaction will be a significant step towards focusing our resources on those businesses where we are best positioned to create additional value for shareholders.” 

Bill Brown, president of UTC Fire & Security, a unit of United Technologies Corp., said "IESG is an excellent strategic fit with our electronic security business. The addition of IESG will strengthen our presence in Europe, particularly in the U.K., Netherlands and France, while adding branch locations in the U.S. The combined businesses position us well for further growth and expansion, and brings additional value to our customers, shareholders and employees. We are looking forward to welcoming IESG employees to UTC Fire & Security." 

Rentokil is being advised by Greenhill & Co. International.