The company has entered into an agreement with Advent and will retain a 30 per cent equity stake
Reckitt has entered into an agreement with Advent International, a private equity investor, to divest its essential home business for an enterprise value of up to USD 4.8 billion and retain a 30 per cent equity stake, the company informed.
In July 2024, Reckitt set out its strategy to reshape into a more efficient consumer health and hygiene company, focused on a portfolio of 11 high-growth, high-margin power brands. The Transaction is a key part of this strategy and represents a significant step forward in reshaping Reckitt.
The transaction values essential home at an enterprise value of up to USD 4.8 billion. The company said that this is equivalent to a multiple of 7.7 times essential home’s unaudited adjusted operating profit for the 12 months ending 31 March 2025.
“We are executing our strategic plan at pace. The divestment of essential home represents a significant step forward in unlocking the substantial value in our business. Essential home will benefit from Advent’s new majority ownership with our retained minority stake in essential Home providing a potential long-term value enhancement opportunity for Reckitt,” highlighted Kris Licht, Chief Executive Officer (CEO), Reckitt.
Reckitt will retain an interest in essential home through a 30 per cent equity stake in Advent’s acquisition vehicle, providing a potential long-term value enhancement opportunity for Reckitt. The transaction is expected to complete by 31 December 2025, subject to customary regulatory approvals.
“We are delighted to partner with Reckitt and the essential home management team. The carve-out represents a unique opportunity to create a focused, scaled platform of globally recognised home care brands that operate in attractive categories with structural growth tailwinds,” noted Ranjan Sen, Managing Partner, Advent.
Essential home operates across the air care, surface, pest and laundry segments. The essential home portfolio includes the global brands Air Wick, Calgon, Woolite, Cillit Bang, Resolve, Sole and Easy-Off, as well as around 75 other brands across over 70 markets, as per the official statement.
