Essentra reviews strategic options for tobacco sector-led filter division
Adds details on review, background, shares
Oct 26 (Reuters) - British packaging products maker Essentra Plc ESNT.L said on Tuesday it was reviewing strategic options for its filters business that serves the tobacco industry, as it looks to focus on its component-making division for other sectors.
The company, which has over 80 years of experience in the business of supplying cigarette filters to tobacco firms, said the review is expected to finish in the second quarter of 2022.
Essentra has concluded that it should become a pure play global components business over time and that the strategic review of the filter division was the first step to achieving that.
Shares in Essentra jumped 5% to 288 pence by 0805 GMT.
The tobacco industry over the years has endured negative press and lawsuits for marketing and selling cigarettes, a product that health advocates and experts say continues to be a leading cause of preventable deaths worldwide.
Essentra, which expects annual adjusted operating profit to come in within market range, said its filter division reported a 2.8% rise in revenue in the three months to September.
It said its components business, which makes plastic moulded, vinyl dip moulded and metal items used in equipment manufacturing, automotive and electronics, performed strongly in the quarter.
(Reporting by Amna Karimi in Bengaluru; Editing by Subhranshu Sahu and Rashmi Aich)
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