Citi upgrades Rentokil on Terminix deal
By Michele Maatouk
Date: Thursday 20 Jan 2022
(Sharecast News) - Citi upgraded Rentokil Initial to 'buy' from 'neutral' on Thursday, arguing that the proposed acquisition of US rival Terminix could propel the company into the number 1 slot in US pest control.
It would have estimated market share of 25%, followed by Rollins with 20%, Ecolab with around 5% and Anticimex with 4-5%, Citi said.
"Based on State by State branch footprint analysis, we feel confident that Rentokil can significantly outperform management's synergy target, possibly 2x," the bank said.
It has a 650p price target on Rentokil shares.
Rentokil announced in December that it had agreed to buy Terminix in a $6.7bn deal. It said the combination was expected "to create significant value, enhance long-term growth potential, be highly cash generative and present a compelling industrial logic".
At 1250 GMT, the shares were up 2.6% at 529.20p.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN