Sir Gerry drops Rentokil takeover

Sir Gerry still has his eye on the top job at Rentokil

Sir Gerry Robinson has ruled out a full scale takeover of hygiene-to-security group Rentokil Initial.

But Sir Gerry said he would continue to hold talks with shareholders about becoming chairman of the troubled firm.

The announcement came before a deadline for Sir Gerry to "put up or shut up" about a bid for the company.

He had threatened to make an offer for Rentokil if it failed to take him on to turn around the group, after its first-half profits fell 19.8%.

The group had blamed tough trading conditions for profits sliding to £135.4m ($278m).

Last month, Sir Gerry set out plans to revive the group which included him taking on the chairman's post for between three and five years and a 2.5% stake in the company worth around £70m.

Leadership bid

If the proposals were rebuffed, he warned he would launch a £3bn offer for the firm.

Sir Gerry's investment vehicle - Raphoe - said he was still holding discussions with Rentokil investors about taking on the executive chairman role.

It added that with those shareholders now in talks with Rentokil's management, it expected the situation to be resolved by Monday 24 October - and as a result it had ditched its takeover plans.

Plans currently being discussed involve Sir Gerry being awarded shares in line with performance targets.

"This being the case, Raphoe has concluded that it will not be necessary to make an offer for Rentokil and accordingly now states that it has no further intention of doing so," Raphoe said in a statement.

Sir Gerry recently stood down as chairman of Allied Domecq and set up Raphoe in order to invest in underachieving companies.