Advent to take 70 percent stake in Reckitt’s Essential Home business

October 2025 | DEALFRONT | PRIVATE EQUITY & VENTURE CAPITAL

Financier Worldwide Magazine

October 2025 Issue

Advent International has agreed to acquire a 70 percent stake in Reckitt’s Essential Home division in a transaction valued at up to $4.8bn, including debt. This marks one of the largest private equity deals in the consumer sector this year.

Reckitt will retain a 30 percent minority interest. Essential Home, which includes brands such as Air Wick, Cillit Bang, Calgon, Woolite and Mortein, represented approximately 14 percent of Reckitt’s total net revenue in 2024. However, the division has experienced recent sales declines, with like-for-like net revenue falling 6.5 percent in the first half of 2025.

The deal includes up to $1.3bn in contingent and deferred consideration, comprising performance-based payments, vendor financing and return thresholds. Completion is expected by 31 December 2025, subject to regulatory approvals and customary conditions. Reckitt and Advent are aligned in their strategic vision and committed to enhancing Essential Home’s long-term performance.

Following completion, Reckitt intends to return approximately $2.2bn to shareholders through a special dividend and share consolidation. This will be in addition to its ongoing share buyback programme, with the next tranche expected to be announced alongside its half-year results.

“As a global private equity firm with a strong track record both in executing carve-outs and in backing iconic consumer brands, Advent is well positioned to support Essential Home in the next phase of its journey,” said Nicolas Chavanne, managing director of Advent. “We intend to accelerate investment across the brand portfolio to drive growth and innovation, and create value for both Essential Home’s consumers and trade partners.”

“Our portfolio of market-leading brands has strong foundations and significant value creation potential,” said Paolo D’Orso, chief executive of Essential Home. “Advent is the ideal partner for Essential Home’s next chapter, given their strong expertise in consumer and successful track record in executing complex carve-outs. We are excited about the future of the business as a leading standalone home care platform, and are committed to fostering long-term, sustainable growth.”

“We are delighted to partner with Reckitt and the Essential Home management team,” said Ranjan Sen, managing partner of Advent. “The carve-out represents a unique opportunity to create a focused, scaled platform of globally recognised home care brands that operate in attractive categories with structural growth tailwinds. We are confident we can build on the portfolio’s strong foundations to drive operational excellence and unlock the brands’ full potential.”

“We are executing our strategic plan at pace,” said Kris Licht, chief executive of Reckitt. “The divestment of Essential Home represents a significant step forward in unlocking the substantial value in our business. This moves Reckitt towards becoming a simpler, more effective world-class consumer health and hygiene company and enables us to focus on a core portfolio of high-growth, high-margin Powerbrands. Essential Home will benefit from Advent’s new majority ownership, with our retained minority stake providing a potential long-term value enhancement opportunity.”

Essential Home operates across the air care, surface, pest and laundry categories and generated approximately £2bn in net revenue in 2024. It posted adjusted operating profit of £490m for the year ended 31 December 2024, and £486m for the 12 months to 31 March 2025. In Q1 2025, the division recorded unaudited net revenue of £482m, with a 7 percent like-for-like decline.

Reckitt continues to face investor pressure to streamline its portfolio and concentrate on its core health and hygiene brands. The company is also navigating legal challenges related to its Mead Johnson baby formula unit. As of August 2025, Mead Johnson is involved in multidistrict litigation concerning alleged links between its Enfamil formula and necrotising enterocolitis in premature infants. Over 740 cases are pending, with bellwether trials scheduled throughout 2025 and into 2026. A recent court ruling overturned a prior defence verdict, allowing a new trial to proceed.

Richard Summerfield