TIDMRTO
RNS Number : 2414W
Rentokil Initial PLC
13 November 2017
13 November 2017
ACQUISITION OF LEADING VECTOR CONTROL COMPANY IN NORTH
AMERICA
Up-weighted M&A spend guidance for H2 2017 to GBP100m+
Rentokil Initial plc (FTSE: RTO, "the Company") today announces
that is has acquired Vector Disease Acquisition, LLC ("VDA"), North
America's largest provider of mosquito control services.
For many vector-borne diseases such as Zika Virus, West Nile
Virus, Yellow Fever, Malaria and Dengue Fever, vector control
services are the most effective way to protect public health.
VDA provides a full range of vector control services, including
weekly monitoring of mosquito levels, species identification and
disease testing (using its in-house laboratory) and control of both
adult and larval mosquitoes from the ground and using aircraft. In
line with this acquisition, the Company is establishing a new
global centre of excellence for mosquito control, which will be
based in North America.
VDA also provides lake management services, a new route-based
service line for Rentokil North America. Invasive aquatic plants
destroy fish and wildlife, and clog pipes used for drinking water,
hydroelectric and irrigation supplies. Services include chemical
treatments, mechanical vegetation removal, aeration and fountain
management. The Lake Management division, which is predominately a
contract portfolio business, is also the largest of its type in
North America.
Headquartered in Little Rock, Arkansas, VDA operates from 52
offices in 32 U.S. states. Annualised revenues for the 12 months
prior to acquisition were c. $47m (GBP36m).
Commenting on the acquisition, Andy Ransom, CEO of Rentokil
Initial, said:
"The growing threat to public health from mosquitoes makes
vector control an important and growing part of the overall pest
control market. Factors such as climate change and increased travel
are leading to more vector-borne disease outbreaks than ever
before.
"We are now positioned strongly in two attractive markets that
are characterised by good growth, high technical skill level and
strong regulatory requirements, attributes that play well to
Rentokil Initial's traditional strengths and expertise. This is
another important step towards our ambition to create a business in
North America with revenues of c. $1.5bn and margins of c. 18% by
the end of 2020.
"Given the increasing demand for mosquito control in many parts
of the world and the unrivalled expertise in VDA, this is also a
significant acquisition for our global pest control business.
"Our M&A pipeline remains very strong and therefore we now
expect spend to be GBP100m+ in H2 2017."
For further information please contact:
Rentokil Initial plc
Katharine 07811 270
Investors Rycroft 734
Malcolm 07788 978
Media Padley 199
Notes to editors:
Rentokil Initial
-- Rentokil Initial plc is one of the largest business services
companies in the world, operating in 70 countries and employing
35,500 colleagues. The Company offers route-based services,
primarily in Pest Control and Hygiene, through teams of local
experts. Rentokil is the world's largest commercial pest control
company.
-- For more information, visit www.rentokil-initial.com.
Vector Disease Acquisition, LLC ("VDA")
Mosquito Control Services
-- The main mosquito control operations operate under a legal
entity called Vector Disease Control International, LLC.
-- Demand for mosquito control is driven by public health needs
or a combination of public health and nuisance management and is
highly technically focused. VDA provides a full range of mosquito
control services. 90% of revenues are contracted.
-- VDA serves primarily governmental customers (cities, counties
and mosquito abatement districts plus the Federal Centers for
Disease Control (CDC)) but there are also some industrial
customers.
-- The US vector control market for municipalities and government is estimated at $400m p.a.
-- The business has a high-experienced management team and
employees 80 FTE and 300 seasonal employees. VDA's aerial division
has 14 aircraft operating out of 4 airports.
Lake Management Services
-- The main lake management operations operate under a legal
entity called Solitude Lake Management, LLC.
-- Lake Management provides services primarily on the east coast
of the USA. Customers are municipal, state and federal governments,
homeowner associations, lake associations, golf courses and
corporate entities.
-- Revenues are predominately contracted with services including
aeration and fountain management, controlling invasive aquatic
vegetation and algae in lakes and ponds.
ENDS
This information is provided by RNS
The company news service from the London Stock Exchange
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