Rentokil expands US reach

Rentokil Initial is set to become the third largest pest control firm in the US after it agreed a multi-million dollar deal to buy the Western Exterminator Company.

The British firm said Western's 36 offices, located primarily in California and the adjacent states of Arizona and Nevada, would give it exposure to 46m people living in these states.

Chief Executive Alan Brown said the deal enabled the company to compete more effectively in the US, particularly for customers looking for nationwide coverage in pest control or specialty chemical distribution capability.

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Rentokil will initially pay $99.6m, with a deferred consideration of up to $15m payable within 18 months.

The tie-up will make the firm the third largest pest control company in the North American market with revenues of $330m in pest control services and $90m in speciality chemical products distribution.

Over the last seven years Rentokil has substantially increased its footprint in the US through acquisitions that have seen revenues there grow from less than $30m to $420m.