Complex sentence: When some people (whom were shown earlier to be business associates) arrive at reception asking after Mr. Leeman, Basil thinks they are the undertakers and while talking to them the linen basket, with Leeman inside, is taken away by the laundry men.
Split into simpler sentences: When some people (whom were shown earlier to be business associates) arrive at reception asking after Mr. Leeman, Basil thinks they are the undertakers. While he is talking to them, the linen basket with Leeman inside is taken away by the laundry men.