Advent International is in continued discussions with Reckitt over a potential acquisition of its Essential Home division, which includes the Air Wick and Cillit Bang brands, according to Reuters.

The UK-based consumer goods group is considering alternative deal structures after initial bids came in below its £4bn ($5.4bn) valuation target.

Sources close to the matter report that Advent has emerged as a lead contender, with both parties exploring creative structuring options to bridge the valuation gap. These may include Reckitt retaining a minority stake or incorporating earn-outs—mechanisms commonly used in private equity to manage risk while preserving long-term upside.

The Essential Home carve-out forms part of CEO Kris Licht’s strategy to streamline operations and concentrate on higher-margin health and hygiene categories. The divestment process, launched in mid-2024, is expected to conclude by year-end 2025.

Despite broader M&A headwinds, including macroeconomic volatility and trade disruptions, Reckitt’s asset has drawn interest. However, Essential Home reported a 7% year-on-year revenue decline in Q1 2025 to £482m, reflecting pressure from shifting consumer trends and rising competition from private label products.

Advent’s sustained interest underscores the firm’s appetite for carve-out deals and value creation opportunities in branded consumer goods. The outcome of the talks could set the tone for further private equity-led transactions in the consumer space amid a cautious dealmaking environment.

Source: Reuters

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