Shares in Rentokil Initial (NYSE: RTO) soared 12% on Monday after a media report said that former BT Group boss Philip Jansen was working on a private equity-backed takeover bid for the British pest control firm.
Jansen, who stepped down as BT’s chief executive earlier this year, is in talks with private equity firms over a plan that would see him appointed as executive chairman of Rentokil, the Sunday Times reported over the weekend.
Rentokil Initial (NYSE: RTO), which is set to report first-half results on Thursday, declined to comment in response to Reuters’ queries.
“We believe some of the approaches that Philip Jansen had to lead BT could apply to Rentokil, such as investments in the business and focus on efficiency,” JPMorgan analysts said in a note.
The Rentokil stock hit its highest level since October 19, when it tumbled more than 18% after the company flagged soft demand in North America, its largest market.
Its FTSE 100-listed shares have lost nearly a third of their value from an all-time high in June last year.
Last month, activist investor Nelson Peltz’s Trian Fund accumulated a significant stake in the company, making the New York-based hedge fund one of the top 10 shareholders in Rentokil.
“Whilst this press report is unsubstantiated, we think it (and the Trian stake) could help to provide a floor to the shares and to squeeze out any shorts,” analysts at RBC Capital Markets said in a note.
(Source: ReutersReuters)
