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PRIVACY
Manufacturing

Smiths Group to be broken up as FTSE 100 giant ditches big chunk of business

The FTSE 100 engineering group will sell off Smiths Interconnect and separate Smiths Detection via a demerger or sale in a major shake-up

Smiths Group CEO Roland Carter (Image: Smiths Group)

Smiths Group has revealed its intention to offload a significant portion of its business, responding to investor demands for a substantial overhaul.

The FTSE 100 engineering conglomerate announced on Friday plans to divest Smiths Interconnect and separate Smiths Detection through a demerger or sale, as reported by .

Smiths explained that this move would allow it to focus more on its John Crane and Flex-Tex operations, unlocking "significant value" and boosting shareholder returns.

This follows calls from US activist investor Engine Capital earlier this month for the conglomerate to split its four businesses, mirroring other industrial firms.

Smiths aims to announce a transaction for Smiths Interconnect, a manufacturer of electronic components and connectors, by the end of 2025.

Additionally, the company has launched a £500m share buyback scheme to enhance shareholder returns, who are also set to receive a large chunk of the disposal proceeds from the division break-ups.

As part of the restructuring, a new board committee will be established to supervise execution. Roland Carter, who joined Smiths Group as CEO last March, stated: "We are pleased with the financial and operating performance of the group over recent years, including the recent upgrade to earnings."

He added, "Against this strong backdrop and since my appointment, the Board has spent considerable time evaluating the options to maximise shareholder value and address the persistent discount to the significant value embedded within the Group."