Reason of splitting:

Reckitt Benckiser stumbled in the third quarter after manufacturing problems at a Dutch factory making
infant formula left it unable to meet demand, disappointing investors who had hoped that a long-
promised turnround was taking hold.

The weak quarter is not likely to help Reckitt in its effort to win back investor trust, which has been
eroding since 2016 when underlying sales growth slowed from the typical 4 to 6 per cent to 3 per cent.

Growth then stalled completely in 2017, with performance being marred by “one-offs” including a cyber
attack, a boycott in South Korea and a failed product launch at footcare brand Scholls.

The health portion of the business would have revenues of £7.5bn,

accounting for 60 per cent of the group total.

Philip Gorham, analyst at Morningstar, says: “The restructuring is a clear indication that Kapoor’s long-
term vision for RB lies in the consumer health business, and may be a precursor to the disposal of the
home and hygiene assets in the future.”

Reckitt will operate from two business units from the start of
2018.

Rob de Groot, who currently runs Reckitt’s business in

Europe and North America, will head the home and hygiene
business. He will report to Rakesh Kapoor, who will remain
the group’s CEO and also have charge of the healthcare
operations, which account for two-thirds of the company.

The decision was made after the $16 billion purchase of baby
milk maker Mead Johnson gave it greater scale in consumer
health, Kapoor told Reuters.