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Terminix Global Stock Soars 27% on $6.7B Acquisition from Rentokil

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Updated: 14 Dec 2021

Terminix (NYSE: TMX), one of the largest pest control companies in the world, announced today that they will be acquired by Rentokil, a prominent name in British pest control. The news was interpreted as a story of two sides – with Terminix Global stock surging over 25%, but with Rentokil stock plunging almost 10%.

In Rentokil’s move to globalize, the acquisition of U.S competitor Terminix appeared the first priority in order to efficiently scale and grow as desired. The deal will be funded through a transaction involving $1.3B in cash and more than 640M Rentokil shares – implying a Terminix stock value of $55 – a 47% premium on Terminix’s Monday closing price. 

Although Rentokil shared benefitted from a spark in bullish momentum, the move was quickly reversed and stock is currently down just under 10%. Whether it was a bout of sharp profit-taking or changing sentiment regarding their largest acquisition to date – sellers were very much present in the UK market. 

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However, it’s all rosy for Terminix investors this morning, as the stock continues to demonstrate strong support in premarket trading. As the price starts to consolidate around the $47.50 level, we might have to wait for the opening bells for a surge in support from retail traders. TMX is holding onto a premarket gain of 27%, trading at a price of $47.50. 

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