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Trump tariff war has dealt blow to dealmaking

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Reckitt still pursuing sale of Essential Home unit,

sources say

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Bids didn't match hopes for over 4 billion pounds, source

says

By Amy-Jo Crowley and Richa Naidu

LONDON, June 3 (Reuters) - Britain's Reckitt is

considering new options to advance a sale of its Essential Home

business, home to Air Wick fresheners and Cillit Bang cleaners,

after bids came in below expectations, two people with knowledge

of the process said.

The company still plans to pursue a sale, the people said,

who spoke on condition of anonymity because the talks are

private. Private equity firm Advent remains in talks for the

assets, one of the people and a third person said.

Reckitt, which also makes Mucinex cold medication and Durex

condoms, said in July it was looking to offload a portfolio of

homecare brands by the end of 2025.

The proposed sale comes at a challenging time for businesses

with factories around the world as they navigate U.S. President

Donald Trump's tariffs, which are roiling supply chains,

boosting costs and dampening shopper sentiment.

Reckitt could keep a stake in the business or structure a

sale another way to bridge a gap in valuations, one of the

people said, adding that some of the bids came in below its

hopes of over 4 billion pounds ($5.4 billion).

Reuters could not determine if other bidders remained in the

process.

Reckitt and Advent declined to comment.

Bankers and CEOs have hit the brakes on mergers and

acquisitions since Trump launched his trade war, with fewer

deals getting signed than during the bleakest days of the

COVID-19 pandemic and the 2008-2009 global financial crisis.

Reckitt said in April that it was "continuing to progress"

the sale of the Essential Home business but that market

conditions might affect the time frame.

Consumer staples companies are considered relatively

resilient to economic downturns, but big brands like Reckitt,

P&G and Unilever ( UL ) increasingly face competition

from cheaper private label brands that gained popularity during

the pandemic.

Reckitt's Essential Home business has struggled for several

quarters, with sales falling 7% in the first quarter of this

year to 482 million pounds, about 13% of total revenue for the

quarter.

Reckitt has been undergoing a turnaround under CEO Kris

Licht, who has sought to reassure shareholders concerned about

the strength of the company's brands in North America and

Europe, where consumer confidence has been dwindling.

($1 = 0.7397 pounds)