Filtrona Shares Gain on Debut After Split From Bunzl

Source from:  Bloomberg, June 6 06/07/2005

Shares of Filtrona Plc gained as much as 10 percent on their first day of trading following the cigarette-filter business's spin off from Bunzl Plc. Filtrona made its debut on the London Stock Exchange at 230 pence and advanced to as high as 253 pence. It was trading at 252 pence as of 10:41 a.m. in London, valuing the Milton Keynes, central England-based company at 554 million pounds ($1.01 billion). Headed by Mark Harper, Filtrona makes filters for British American Tobacco Plc's Kent brand, plastic trim for Boeing 777 airliners and deodorant bottles for Unilever Plc. The unit, which had sales of 477 million pounds last year, is also the biggest maker of tear tape that opens chewing gum and compact discs. ``We're very positive on Filtrona,'' said Mike Murphy, an analyst at Panmure Gordon in London with a ``buy'' rating on the stock. ``They have a good management team and a good business. The spin off was definitely the right thing for them.'' Bunzl, based in London, shed Filtrona to concentrate on a packaging business built up through 20 purchases since 2000. The unit had contributed 16 percent of its parent's total revenue. Existing investors received nine Filtrona shares and 14 Bunzl shares for every 18 Bunzl shares they had previously held. Bunzl's market value was today reduced to about 1.82 billion pounds from more than 2.3 billion prior to the split. ``We see Bunzl as being very attractive and with immense opportunities outside the grocery segment,'' Murphy said. He recommends buying the stock.