Rentokil Initial plc (LSE:RTO) entered into a definitive agreement to acquire Terminix Global Holdings, Inc. (NYSE:TMX) from The Vanguard Group, Inc., Morgan Stanley (NYSE:MS), Janus Henderson Group plc (NYSE:JHG), T. Rowe Price Associates, Inc. and others for $6.7 billion on December 13, 2021. Under the terms of the agreement, Rentokil Initial will issue to Terminix shareholders at closing aggregate consideration comprised of approximately 643.29 million new Rentokil Initial shares in the form of ADSs and approximately $1.3 billion in cash. The transaction values the entire share capital of Terminix at $6.7 billion, implying a value of $55.00 per share of Terminix common stock, and represents an aggregate consideration mix of 80% stock and 20% cash. Terminix shareholders may elect to receive all cash or all stock consideration, subject to proration in the event of oversubscription. Each Terminix share for which no election or an invalid election is received will be deemed to have elected for all stock consideration. Post-completion, Rentokil shareholders will own about 74% stake and Terminix's existing shareholders will own other 26% stake in combined entity. Rentokil Initial has entered into a committed bridge facility for up to $2.7 billion with Barclays to support the financing of the cash consideration. On 25 February 2022, Rentokil Initial replaced its $2.7 billion bridge facility provided by Barclays with a $700 million three- year term loan facility provided by 15 banks and a $2 billion bridge facility provided by eight banks. Subsequently, during June 2022, in order to convert the bridge facility into long-term debt, the Group successfully priced three bonds: €850 million 5-year at 3.875%; €600 million 8-year at 4.375%; and £400 million 10-year at 5.0%. These bonds fully cover the $1.3 billion cash element of the transaction consideration. The balance of the bonds alongside the $700 million three year loan facility will cover the refinancing of Terminix debt and transaction costs. As of February 9, 2022, Franchise Partners encourages the Terminix board to immediately add a "go-shop" clause to their agreement with Rentokil. The board should openly invite and actively engage with other parties who might offer better value to Terminix shareholders. This is consistent with best governance practices. The merger agreement may be terminated under certain circumstances, including if the mergers has not been consummated on or before September 13, 2022 (“End Date”). On March 14, 2022, Rentokil and Terminix have amended the End Date to December 31, 2022 to provide additional certainty for the parties in connection with the timing of the necessary steps to completion. In case of termination, Terminix will be liable to pay a termination fee of $200 million and Rentokil Initial will be liable to pay a termination fee $150 million. Upon completion, the Board of combined company will consist of Richard Solomons, current Chairman of Rentokil Initial, who will be Chairman of the combined company; Andy Ransom, current Chief Executive Officer of Rentokil Initial, who will be Chief Executive Officer of combined company; Stuart Ingall-Tombs, current Chief Financial Officer of Rentokil Initial, who will be Chief Financial Officer of combined company; Five non-executive directors who currently make up the Board of Rentokil Initial and One non-executive director from the Board of Terminix. The combined company will be incorporated, headquartered and domiciled in United Kingdom.

The transaction is subject to approval from shareholders of both Rentokil Initial and Terminix, regulatory approval in United States, approval of the new Rentokil Initial shares for listing on the LSE and the Rentokil Initial ADSs on the NYSE, registration statement effectiveness, expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other customary conditions for closing. The Boards of Directors of both Terminix and Rentokil Initial have unanimously approved the transaction and resolved to recommend that their respective shareholders vote in favor of it. As on June 1, 2022, Terminix satisfies a key closing condition of the transaction by completing the divestment of its U.K. and Norway Businesses. In line with Rentokil Initial's undertakings to the CMA, Terminix will dispose of its UK business prior to completion of the transaction. The transaction is expected to deliver mid-teens percent accretion to Rentokil Initial's earnings per share in the first full year post completion. With effect from the close of business on March 14, 2022, the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 has now expired, thereby completing the necessary antitrust process in the US and satisfying one of the principal conditions to completion of the transaction. The remaining conditions include approval from Rentokil and Terminix's shareholders, and the registration and listing of Rentokil's American Depositary Shares on the New York Stock Exchange. Rentokil Initial shareholders vote in favour of proposed acquisition of Terminix. Terminix shareholders have voted at a special meeting of shareholders to adopt and approve the transaction. The transaction is expected to close in second half of 2022. As of March 15, 2022, the parties remain on track for closing to take place in the second half of 2022. Terminix and Rentokil Initial expect to complete the transaction on October 12, 2022.

Gary Posternack, Mark Astaire, Omar Faruqui and Tom Macdonald of Barclays Bank PLC and Anthony Gutman, Diego Fortunati, Jimmy Bastock and Mitul Patel of Goldman Sachs International acted as financial advisors while William H. Aaronson, Jeffrey P. Crandall, Pritesh P. Shah, William A. Curran, Howard Shelanski, Suzanne Munck af Rosenschold, J.W. Perry and John B. Meade of Davis Polk & Wardwell LLP and Julian G. Long, Daragh Fagan, Cate Sharp, Jennifer Bethlehem, Alastair Chapman, Paul Davison and David Mendel of Freshfields Bruckhaus Deringer LLP acted as legal advisors to Rentokil Initial. Lazard Freres & Co. LLC acted as financial advisor and fairness opinion provider while Andrew R. Brownstein, Karessa L. Cain, Damian G. Didden, Franco Castelli, Andrea K. Wahlquist, Michael S. Benn, Morgan A. Arthur and Selwyn B. Goldberg of Wachtell, Lipton, Rosen & Katz LLP and Harry Coghill, Tom Rose, Malcolm Walton, Richard Pepper, Tilly Hendersonof, Jeremy Moncrieff, Jack Slater, Malcolm Hitching, Chris Page and Rasmus Berglund of Macfarlanes LLP acted as legal advisors to Terminix. Andrew Kaplan of Gibson, Dunn & Crutcher acted as a legal advisor to Lazard Freres & Co. LLC. Terminix has engaged Innisfree M&A Incorporated to assist in the solicitation of proxies for the Terminix special meeting. Terminix estimates that it will pay Innisfree a fee of approximately $25,000, plus reimbursement for certain out-of-pocket fees and expenses. In connection with Lazard's services as a financial advisor to the Terminix board of directors, Terminix agreed to pay Lazard an aggregate fee of $45 million, $5.0 million of which has been paid and the remainder of which is payable contingent upon consummation of the transaction. Computershare Trust Company N.A. served as transfer agent for Terminix. Equiniti Limited acted as registrar and PricewaterhouseCoopers LLP acted as accountant to Rentokil.