Household goods giant Reckitt Benckiser has agreed a deal worth up to 4.8 billion US dollars (£3.6 billion) to sell its majority stake in its cleaning products arm. The sale includes popular British household brands such as Cillit Bang and Calgon.
Private equity firm Advent International will buy a 70% stake in Reckitt's essential home cleaning products business. The division also includes brands such as Air Wick, Woolite, Resolve, Sole and Easy-Off, as well as around 75 other brands across more than 70 markets.
Reckitt retains minority stake
Reckitt will keep a 30% stake in the essential home business after the sale, with up to 1.3 billion dollars (£968 million) deferred under the deal. The firm will also book around 800 million dollars (£596 million) in costs for splitting out the essential home division from the rest of the business.
The company expects to complete the deal by the end of the year. The essential home division accounts for 13% of group net revenues and was put up for sale last summer as part of a major overhaul.
Strategic restructuring plan
Kris Licht, Reckitt chief executive, said the divestment represents "a significant step forward in unlocking the substantial value in our business". He added that the move will help Reckitt become "a simpler, more effective world-class consumer health and hygiene company".
Licht has been leading a plan to restructure Reckitt, unveiling aims last year to spin off its baby formula business, Mead Johnson, and sell the essential home division. The strategy focuses on "power brands", such as Durex condoms, Gaviscon antacid and Strepsils lozenges.
(PA) Note: This article has been edited with the help of Artificial Intelligence.
