Molins seeks pounds 38m from pension fund

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Andrew Feinberg

White House Correspondent

MOLINS is still attempting to unlock pounds 38m from the company's pension scheme, which will enable it to cut debts, enhance pensioners' benefits, and pursue acquisitions, writes John Shepherd.

Michael Orr, chairman of the cigarette-rolling machinery maker, said yesterday it was talking to independent pension scheme trustees to try to work out a way to use a proportion of the scheme's surplus.

An actuarial valuation in January put the total surplus at pounds 90m. The amount that can be paid to the company, though, is governed by more restrictive criteria.

Molins said it was proceeding cautiously, against the backdrop of the Maxwell scandal and other pension issues that have drawn unfavourable attention.

'Desk work' had been done on some possible acquisitions, said Molins. However, it stressed there was no urgency to buy anything.

Meanwhile, Molins increased pre-tax profits from pounds 6.8m to pounds 7.2m in the half year to 30 June, a period that for the first time in several years was not hindered by a takeover bid.

Free from the attention of Leucadia of the US, Molins finds itself 'busier with the opportunities that the absence of Leucadia has opened up', Mr Orr said. 'We are confident that the progress shown in the first half will continue through 1992.'

The interim dividend is being lifted from 3p to 4.5p, partly in order to reduce the disparity with the final payment. Even so, Molins said it hoped to continue increasing dividends above the rate of inflation.