Rentokil now pushes out its chief executive

Rentokil Initial yesterday parted company with James Wilde, chief executive, barely two months after showing the door to Sir Clive Thompson, the long-time chairman.

The move increased speculation that an internal review now under way could lead to a restructuring, or even a break-up, of the FTSE 100 pest control and contract cleaning group that has a market value of £2.58bn.

Brian McGowan, who will act as executive chairman until a successor is found for Mr Wilde, said Rentokil had not had a “fresh set of eyes at the top for 21 years”.

Mr Wilde, 51, became chief executive in January 2003. He had joined Rentokil in 1993 after its hostile takeover of Securiguard, where he was a director.

Mr McGowan said Rentokil needed “someone from the outside to look at the way it does its business”.

Mr Wilde’s departure marks a reversal by the Rentokil board, which had backed him against Sir Clive. But Mr McGowan said the succession of departures “was not planned as a one-two. I believed what I said back in May”.

But during 10 weeks of consultation in the company and with investors, Mr McGowan said he had been asked: “Are you sure you’re happy with the management?” The new chief executive would not have to come from the support services sector, Mr McGowan said. “I am not convinced that the man at the top of this business or any other needs to be an expert in all our businesses.”

Spencer Stuart is conducting the search for a successor. Mr McGowan said the process could take up to nine months, although “I could get lucky like Marks and Spencer”.

This means a new chief executive is unlikely to be named when Mr McGowan reports on his review of the business on August 26, along with Rentokil’s interim results.

Sir Clive, meanwhile, said Mr Wilde’s departure came as a surprise. He believed it reflected a difference over strategy.

He was confident that Rentokil would now follow his view that parcels delivery and conferences should be sold, the core businesses strengthened and surplus cash returned to shareholders through more buy-backs and enhanced dividends.

Mr Wilde will receive one year’s salary of £650,000.

Rentokil said there was no change to its forecast that 2004 pre-tax profit would be at least £350m against £396.8m in 2003. Its shares closed ½p higher at 143p.

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