Britain’s Reckitt (RKT.L) is considering new options to advance a sale of its Essential Home business, home to Air Wick fresheners and Cillit Bang cleaners, after bids came in below expectations, two people with knowledge of the process said.
The company still plans to pursue a sale, the people said, who spoke on condition of anonymity because the talks are private. Private equity firm Advent remains in talks for the assets, one of the people and a third person said.
Reckitt, which also makes Mucinex cold medication and Durex condoms, said in July it was looking to offload a portfolio of homecare brands by the end of 2025.
The proposed sale comes at a challenging time for businesses with factories around the world as they navigate U.S. President Donald Trump’s tariffs, which are roiling supply chains, boosting costs and dampening shopper sentiment.
Reckitt could keep a stake in the business or structure a sale another way to bridge a gap in valuations, one of the people said, adding that some of the bids came in below its hopes of over 4 billion pounds ($5.4 billion).
Reuters could not determine if other bidders remained in the process.
Reckitt and Advent declined to comment.
Bankers and CEOs have hit the brakes on mergers and acquisitions since Trump launched his trade war, with fewer deals getting signed than during the bleakest days of the COVID-19 pandemic and the 2008-2009 global financial crisis.
Reckitt said in April that it was “continuing to progress” the sale of the Essential Home business but that market conditions might affect the time frame.
Consumer staples companies are considered relatively resilient to economic downturns, but big brands like Reckitt, P&G (PG.N) and Unilever (ULVR.L) increasingly face competition from cheaper private label brands that gained popularity during the pandemic.
Reckitt’s Essential Home business has struggled for several quarters, with sales falling 7% in the first quarter of this year to 482 million pounds, about 13% of total revenue for the quarter.
Reckitt has been undergoing a turnaround under CEO Kris Licht, who has sought to reassure shareholders concerned about the strength of the company’s brands in North America and Europe, where consumer confidence has been dwindling.
Source: Reuters.com