LONDON, March 15 (Reuters) - Support services firm Rentokil Initial Plc (RTO.L) announced a rebranding of its tropical plants rental business on Thursday and said it would expand into new services, such as scenting hotels with coffee smells.
Jeff Mariola, managing director of the business, which is being renamed Ambius, said the expansion was part of the British company’s drive to boost revenues and profits and to bolster the global reach of the new brand.
But analysts at Seymour Pierce said the move could be a precursor to the sale of the business, which they estimate could fetch up to 85 million pounds ($165 million).
Rentokil has been selling off underperforming businesses, such as its guarding units and Initial Style Conferences while the electronic security unit is up for sale, to focus on core operations including biggest unit Textiles & Washrooms Services.
“As far as the profitability of the business in 2007, we are confident that you will see year-on-year improvement in every area that we are working in,” Jeff Mariola, managing director of Ambius, told Reuters. Rentokil, best known for its pest control business, said the the name change would allow development of a global brand and to sell services to customers that want a one-stop shop for an increased number of services.
Ambius, which has 80,000 customers in 16 countries, raised revenues by 4.1 percent in 2006 to 106.6 million pounds ($206 million) and Mariola said the group would look to earn more from each customer by offering them more.
He said Ambius would market “ambient scenting”, recently introduced in the U.S., which allows customers to scent rooms -- such as coffee smells in hotels -- as well as other services such as office landscaping and fresh fruit delivery.
Mariola said plants are seen as way for human resource departments to create a more pleasant working environment for staff, with studies showing a good ambiance cut staff turnover and absenteeism, while improving a company’s green credentials.
“In some countries that are now scoring for green building measurements plants are included on the scorecard because plants regulate humidity, they clean the air,” Mariola said. Shares in Rentokil, which have lagged the UK support services sector .FTASX2790 by 12 percent over the last 12 months, were up 1.9 percent at 150-1/2 pence by 1400 GMT, valuing the group at around 2.7 billion pounds.