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Rentokil Initial Announces Hart-Scott-Rodino Waiting Period Expires for Acquisition of Terminix Global Holdings (TMX)

March 15, 2022 7:07 AM EDT

With respect to the definitive agreement (the “Agreement”) under which Rentokil Initial plc (the “Company”) will acquire Terminix Global Holdings, Inc ("Terminix") for stock and cash (the “Combination” or the “Transaction”), announced on 14 December 2021, the Company and Terminix today announce that with effect from the close of business on 14 March 2022, the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 has now expired, thereby completing the necessary antitrust process in the US and satisfying one of the principal conditions to completion of the Transaction.

The Transaction will bring together two complementary businesses (the "Combined Group") to create the global leader in pest control and hygiene & wellbeing, and the leader in the pest control business in North America, the world’s largest pest control market. The Transaction will combine two leading brands with a long cultural heritage, outstanding talent and strong focus on people, customers and ESG. Upon completion, the Combined Group will have c.56,000 colleagues serving c.4.9m customers around the world from 790 locations. The enlarged business will have a strong platform for growth, particularly in North America, and an attractive financial profile to support future growth, including through acquisitions and continued investment in innovation and technology. For the year ended 31 December 2021, the Combined Group’s illustrative revenue would have amounted to US$6.0bn1 (£4.5bn), with EBITDA of US$1.3bn (£1.0bn) and Free Cash Flow of US$0.7bn (£0.5bn).

The Combination is expected to create significant value, enhance long-term growth potential, be highly cash generative and present a compelling industrial logic, supported by:

increased scale and leadership in the global pest control market;

substantially increased scale in North America, providing an enlarged platform for profitable growth;

a complementary and synergistic portfolio combination; and

an attractive financial profile.

A number of other conditions to the Agreement remain to be satisfied and these are being actively progressed by the Company and Terminix. Those conditions include, inter alia, obtaining the approval by the Company’s and Terminix’s shareholders of the Combination, and for the registration of the Company ADSs and their listing on the New York Stock Exchange.

The Company is pleased with the progress being made in order to satisfy the remaining conditions, and the parties are now targetting the Combination closing towards the end of the third quarter of 2022. In order to provide additional certainty for the parties regarding the timing of the necessary steps to completion, including allowing sufficient time for the SEC and FCA to review and approve the necessary documentation for submission to shareholders and registration of the Company ADSs, the Company and Terminix have amended the End Date (as defined in the Agreement) from 13 September 2022 to 31 December 2022. Accordingly, the parties remain on track for closing to take place within H2 2022.

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1 GBP/USD rate of 1.3273 as per 10 December 2021 used to form Combined Group financials. Illustrative combined financials have been calculated using Terminix’s financial results in accordance with US GAAP and Rentokil Initial’s results in accordance with IFRS. The unaudited combined pro forma financial information is for information purposes only and is not intended to represent or be indicative of Rentokil Initial’s or Terminix’s financial position or results of operations that Rentokil Initial or Terminix would have reported had the pro forma adjustments not been made and is not necessarily indicative of Rentokil Initial’s or Terminix’s future financial position or results of operations.

About Rentokil Initial:

Founded in 1925, Rentokil Initial is a leader in the pest control and hygiene & wellbeing service industry. The Company has c.46,000 employees, and over 1,800 local service teams across the world covering around 90% of global GDP in over 90 of the world's 100 largest cities across the US, Europe, UK, Asia, Pacific and Rest of World. It operates in 88 countries. The Company's business model is focused on compounding revenue, profit and cash growth through a combination of organic growth and M&A.

About Terminix:

Terminix Global Holdings (NYSE: TMX) is a leading provider of residential and commercial pest management. The Company provides pest management services and protection against termites, mosquitoes, rodents and other pests. Headquartered in Memphis, Tenn., with more than 11,700 teammates and 2.9 million customers, the Company visits more than 50,000 homes and businesses every day. It has scale and deep presence in the U.S. with over 93% of revenues coming from the United States. During 2021, Terminix generated a total revenue of US$2.045bn, adjusted EBITDA of US$387m and profit from continuing operations before income taxes of US$180m. As of December 31, 2021, Terminix had gross assets of US$4.41bn. Terminix's executive and senior leaders are Brett Ponton (Chief Executive Officer), Robert Riesbeck (Executive Vice President and Chief Financial Officer), David Dart (Chief Human Resources Officer), Doug Hart (Vice President, Terminix International), Dion Persson (Senior Vice President, Strategy and M&A), Deidre Richardson (Senior Vice President, General Counsel and Corporate Secretary), Jim Summerville (Senior Vice President, Supply Management) and Joy Wald (Senior Vice President and Chief Information Officer).



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