 "Reckitt Benckiser embarks on a dramatic divestment journey, eyeing sales amid struggles with its homecare and infant formula sectors.")
Reckitt Benckiser Group Plc is planning to sell some of its non-core homecare brands, potentially worth over £6 billion, as part of a strategic shift. The company is working with Morgan Stanley on this sale, which includes popular products like Airwick and Cillit Bang. Additionally, Reckitt is exploring options for its infant formula business, guided by Goldman Sachs, including the possibility of selling its Mead Johnson brand. This decision comes as Reckitt focuses on key products such as Dettol, Vanish, and other well-performing brands that thrived during the pandemic. Despite these moves, Reckitt’s shares have dropped more than 20% this year, marking a challenging period for the firm.
Reckitt Benckiser Group Plc is moving forward with plans to offload some of its homecare brands, which it considers non-core. Recent discussions have begun with potential buyers for assets that could be valued at over £6 billion, or about $7.9 billion. The brands in question include popular names like Airwick air fresheners and Cillit Bang cleaners.
The company is collaborating with Morgan Stanley for this potential sale, and interest has been shown mostly by financial investors as well as a few consumer goods companies. A formal sales process is expected to commence within the next few months, with completion anticipated by 2025.
In addition to the homecare brands, Reckitt is also assessing its infant formula business, particularly the Mead Johnson brand. Goldman Sachs is advising on this front, exploring various options including the possibility of a sale. Reckitt’s leadership acknowledges that the infant formula division has faced challenges and hasn’t fit seamlessly within the company structure.
The UK-based firm aims to concentrate its efforts on its “power brands,” such as Strepsils, Mucinex, Gaviscon, and disinfectants like Dettol and Vanish, which gained popularity during the pandemic. The company has seen its shares decline over 20% this year, marking its fourth consecutive annual decline, amidst ongoing operational challenges and legal issues in the US.
As Reckitt Benckiser shifts its strategy, the Market will be watching closely to see how these changes impact the company’s future.
Tags: Reckitt Benckiser, homecare brands, financial news, infant formula, investment, Morgan Stanley, Goldman Sachs, corporate strategy.
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What is Reckitt Benckiser planning to sell?
Reckitt Benckiser is starting talks to sell its homecare assets, which are worth around $7.9 billion. -
Why is Reckitt Benckiser selling these assets?
The company is looking to focus more on its core health and hygiene products, and selling these assets will help them with that strategy. -
Who might buy the homecare assets?
Possible buyers could include other large companies in the cleaning and homecare industry, though specific companies haven’t been named yet. -
What products are included in the homecare assets?
The homecare assets may include cleaning products and brands that Reckitt Benckiser currently owns, but the exact brands have not been specified. - When might the sale happen?
The timeline for the sale is not clear yet, as talks are just starting, and negotiations can take time.
