Cleaning product firm Reckitt set to flog brands such as Cillit Bang, Mr Sheen and Air Wick
THE boss of Reckitt has launched a clean-up operation that will dump brands Cillit Bang, Mr Sheen and Air Wick.
The firm is also exploring options for its baby formula business, marking its 2017 takeover of Mead Johnson as one of the worst deals in history.
New CEO Kris Licht is trying to turn around the FTSE 100 firm’s sluggish performance amid intense scrutiny from activist investors.
Mr Licht said yesterday he was focused on a “simpler, sharper Reckitt”.
He also indicated big job cuts would be on the way as Reckitt turns to more automation and generative AI.
Reckitt said a handful of its homecare brands, which made £1.9billion of sales last year, were no longer core to the business.
Instead the firm will now focus on its “power brands”, which include Durex, Strepsils, Vanish and Nurofen.
Mr Licht said his strategy would “significantly sharpen our portfolio and simplify our organisation for accelerated growth and value-creation”.
His move to consider Mead Johnson “now non-core” comes after former Reckitt boss Rakesh Kapoor splashed $16.6billion (£12.9bn) buying the baby milk unit in 2017.
The deal, priced at 29 times earnings, has since been ranked as one of the biggest merger and acquisition missteps in British business history.
Mead Johnson has been plagued by legal cases, and a tornado recently damaged a warehouse in Indiana, US.
The deal was quickly written down by the last chief exec, Laxman Narasimhan, by £10billion and the Chinese unit has already been offloaded.
Dan Coatsworth, analyst at AJ Bell, said: “Ultimately, it was an example of a company getting too greedy and thinking it could buy growth at any price.”
Brakes on new car numbers
THE number of cars being made slumped in the past year, with the boss of Britain’s car lobby group saying he doubts the industry will ever return to its peak.
Cars manufactured in the UK fell by 7.6 per cent to 416,074 in the first half of the year, The Society Of Motor Manufacturers & Traders revealed.
June was particularly bad as several big manufacturers paused their lines to prepare for a switch to electric models.
But the number of electric cars made also fell by 7.6 per cent to 157,224.
SMMT boss Mike Hawes said greater incentives were needed to persuade motorists to buy electric, if the target of phasing out new petrol cars by 2030 is to be hit.
Mr Hawes said he “struggled to see how we would get back to [making] 2.1million cars”.
He said home-working had reduced the need for two-car households.
Meanwhile Aston Martin Lagonda reported a 32 per cent drop in vehicles made this year.
It expects to spend £2billion by 2027 on the “transition to electrification” and will launch its first plug-in car, the Valhalla, next year.
Euros a triumph for pubs
FOOTBALL fans helped pub chain Marston’s weather a rain-soaked summer.
Marston’s, which has about 1,370 pubs, said that its like-for-like sales jumped by 8 per cent during the week of the Euros semi-final and final games as friends gathered in pubs to watch.
It said the contest helped to “lessen the impact of recent unseasonably wet weather”.
Like-for-like sales in the year to date have risen 5.2 per cent, helped by higher food earnings.
Marston’s recently agreed to sell its remaining brewing operations to Carlsberg for £206million.
Changes to the listing rules mean it no longer has to put the disposal to an investor vote.
Rival Stonegate, owner of the Slug & Lettuce bars, is nearing a debt restructuring that should ease fears for its future.
Ad fest's £1.1B buy
EVENTS giant Informa has struck a £1.16billion takeover of the organiser of the Cannes Lions advertising festival.
Ascential, formerly known as Emap, said it would recommend a 568p-a-share offer from its rival.
Its shares jumped by 26.4 per cent, or 118.2p, to 565p, valuing the business at close to Informa’s bid price.
Informa, a FTSE 100 firm, is the biggest organiser of trade shows in the world.
Councils skint
ONE in ten councils might go bust within the next two years, town hall auditors say.
A survey found 11 per cent of councils’ chief internal auditors thought their council could issue a section 114 notice and effectively go bankrupt.
Worryingly, 88 per cent said staffing issues meant they had not checked the books fully.
Six councils have already gone bust since 2021.
Anne Kiem, head of the Chartered Institute of Internal Auditors, said: “Our research underscores the colossal challenges facing local authorities.”
Tortilla turmoil
SHARES in Mexican food chain Tortilla dipped by 12 per cent yesterday after it admitted a fall in profits, with sales slumping by 5.9 per cent.
Tortilla is no longer on food app Deliveroo after a dispute over commission charges.
EasyJet’s flying
EASYJET put clear blue skies between itself and rival airline Ryanair yesterday, after saying it is set for record summer bookings.
EasyJet posted a 16 per cent rise in third-quarter profits to £236million.
Its growing package holidays arm expects to make £180million this year, 48 per cent up on last year.
Ryanair recently reported profits halved after it had to slash air fares, but easyJet boss Johan Lundgren said fares were “pretty much in line with last year” — down just 1 per cent to £56.95 per passenger.