U.K.’s Reckitt sells majority of Essential Home unit to Advent for up to $4.8 bln

Investing.com -- Reckitt Benckiser Group (LSE:LON:RKT) has agreed to sell the majority of its Essential Home business to private equity firm Advent International in a deal valued at up to $4.8 billion (£3.6 billion).

The transaction, expected to complete by the end of the year, will see Reckitt retain a 30% stake in the business while receiving deferred and contingent consideration of $1.3 billion (£1.0 billion).

The consumer goods company plans to return excess capital to shareholders through a $2.2 billion (£1.6 billion) special dividend, in addition to its ongoing share buyback program.

This amount appears to exceed the immediate net proceeds of $1.3 billion (£0.9 billion) that Reckitt can expect from the deal.

Reckitt intends to announce its next buyback tranche with its first-half 2025 results on July 24, 2025.

The deal’s proceeds and structure have been described as underwhelming compared to earlier valuations of around $5.8 billion (£4.3 billion).

However, completing this transaction may boost management’s credibility and allow investors to focus more on Reckitt’s core business. Ongoing litigation related to NEC remains a concern.

 

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