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Interserve buys Rentokil business6th of March 2014
UK building services and construction company Interserve is to buy Rentokil's Initial Facilities maintenance business in a deal worth 303 million euros. The acquisition gives Interserve access to more than 400 private sector customers including JP Morgan, the London Underground and Debenhams.
The deal will add double-digit percentage growth to earnings next year and a little less in 2014 - probably mid-single digits - Interserve chief executive Adrian Ringrose told Reuters.
He said there was "definitely a more optimistic outlook" for 2014, based on the upturn in Britain's construction sector at the end of last year.
The deal comes as Rentokil, whose services range from pest control to catering and security, nears the end of a major restructuring programme to focus on core businesses. It said proceeds from the sale would be used primarily to pay down debt.
Initial Facilities provides services including cleaning, catering, security, and mechanical and energy management.
Ringrose added: "The rationale behind the deal is to make us a bigger player in a big market that's growing."
Mike Brown, managing director of Initial Facilities commented: ""This is a good combination and a very complementary home for our business, its customers and employees. We will be a core part of one of the UK's largest support services organisations and that focus will undoubtedly present new opportunities that all of our stakeholders can be excited about."