8th Sep 2005 17:44
Rentokil Initial PLC08 September 2005 Response to Raphoe proposal The Board of Rentokil Initial plc ("Rentokil" or the "Company") notes theannouncement made earlier today by Raphoe Management Limited ("Raphoe"). The Board notes that: - The substance of Raphoe's proposal seems simply to install a new Executive Chairman at significant cost - in excess of £75 million at last night's closing share price, plus executive remuneration, plus a share of any capital return- Of this, Sir Gerry Robinson will receive some £55 million, while Raphoe proposes that the Company should pay Europa Partners approximately £20 million- Executive rewards of that scale and without any performance hurdles - as Raphoe proposes - do not meet the corporate governance and remuneration standards supported by the Board of Rentokil and best practice- It is hard to see why Sir Gerry Robinson should receive a significant stake in Rentokil without putting any money into the Company himself and with only a three year time horizon- Raphoe suggests a review of financing structure - but the Company's new Finance Director already has one under way- Raphoe's proposal contains no suggestion as to what operational plans Sir Gerry Robinson thinks he can implement that the current management cannot- In proposing his appointment as Executive Chairman, Sir Gerry Robinson disregards that Rentokil already has a new Chief Executive and a new Finance Director who joined a group with a board structure that follows best governance practice- Much of what Raphoe presents as new initiatives from Sir Gerry Robinson - such as management appointments and capital structure review - is already being actively pursued by the current management team. Brian McGowan, Chairman of Rentokil, said "We run this Company with an open mindas to what will deliver the best value for all shareholders. We are aware thatFranklin Templeton has been in discussions with Sir Gerry Robinson for somemonths. However, based on the announcement today, Raphoe's proposals lookunlikely to be in the best interests of shareholders: Sir Gerry Robinson wantsthe shareholders to give up more than £75 million of the Company's equity and inreturn he may agree to give them up to 35p per share of their own cash".Enquiries: John Sunnucks, Gill Ackers; Brunswick Group LLP: 020 7404 5959 The Directors of Rentokil accept responsibility for the contents of thisannouncement. To the best of their knowledge and belief, having taken allreasonable care to ensure that such is the case, the information contained inthis announcement is in accordance with the facts and does not omit anythinglikely to affect the import of such information. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Rentokil Initial