Philip Morris Will Stay In One Piece

To split or not to split. That was the question Philip Morris' board of directors grappled with at a May 25 meeting. In the end, it decided against dividing the $61 billion conglomerate into separate tobacco and food companies--for now. That didn't sit well with some shareholders, whose shares have long languished in the low 50s. "It's clear that they have to isolate the potential liability" of the domestic tobacco business, says Alan Hevesi, comptroller of New York City. The company did, however, promote two top executives, a move that Michael Sandler, of Pacific Financial Research, interpreted as a "prelude to splitting up the company sometime down the road."

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