Smiths Group Names New CEO, Denies Break-Up Planned
Britain's Smiths Group named a new chief executive on Wednesday but said his track record for selling companies did not signal plans for spin-offs or a takeover in the near future.
Smiths said former Allied Domecq Chief Executive Philip Bowman would replace long-time CEO Keith Butler-Wheelhouse on December 10.
Bowman was CEO of Allied Domecq when it was taken over by Pernod Ricard and CEO at Scottish Power when it was bought by Spanish utility Iberdrola in a deal approved this year.
Smiths sold its main aerospace business for $4.8 billion to U.S. giant GE in January, triggering brokerage analyst speculation that the rest of the company, likely as individual units, might be put up for sale.
That speculation has boosted Smiths shares, which were up 4.89% at 1,115 pence, among the biggest early gainers on the FTSE 100 index.
Smiths also released annual results that were in line with expectations as it posted an operating profit of 348 million pounds ($699.8 million), little changed from 345 million a year earlier.
The headline figure excluded exceptional items, amortisation of acquired intangible assets and financing gains or losses from currency hedging.
Revenues for the year to July 31 slipped 19 million pounds to 2.161 billion and the company raised its proposed dividend to 34 pence from 31.35p.
Butler-Wheelhouse denied brokerage and media speculation that the sale of its aerospace division would lead to more spin-offs.
"We'd like to continue with the three businesses...they are very strong," Butler-Wheelhouse told reporters on a conference call, in reference to its medical equipment, specialty engineering and detection equipment divisions.
"I see no reason" for spin-offs, he said. But asked what he thought Bowman might do, he added: "As long as it will create shareholder value, he will do whatever's best for the company."
Shareholders pocketed a 2.1 billion pound payout following the sale of Smiths' aerospace business.
Butler-Wheelhouse departs after news last week that Smiths had failed to forge a planned joint venture in detection with GE.