Chocolate manufacturer Cadbury today began life once more as a pure confectionery firm after spinning off its American drinks arm.

Shares in the Birmingham-based giant were trading in London as Cadbury after the group dropped the Schweppes joint branding following a decision to demerge the drinks business, Dr Pepper Snapple, through a listing on the New York Stock Exchange, due to take place on May 7.

The move leaves the remaining Cadbury operation as the world's second largest confectionery business, overtaken only by Mars after its deal to buy the Wrigley chewing gum group, unveiled earlier this week.

Standalone Cadbury, which is based in Bournville, has revenues of more than £5 billion and underlying profit of around £500 million, according to the group.

Shares in the firm made their debut on the London Stock Exchange today with a rise of nearly 2% in early trade.

Todd Stitzer, chief executive, said: "The separation of beverages allows us to take the company back to the future. The past few years have seen a transformation of the group's performance and as a focused confectionery company we will be able to do better still."

Cadbury decided to demerge its drinks business, which also makes 7Up, after aborting attempts to sell the operation last year.
The change in plan came as the crisis in credit markets hit the ability of potential buyers to raise finance.

Earlier this month, Cadbury revealed that its share of the chocolate market suffered over Easter after it held back on price cuts. The firm said it opted not to offer aggressive Easter discounting as it came under pressure from rising raw material costs.

But it still saw a 3% rise in UK revenues in the three months to March with overall group confectionery revenues growing 7% after a strong performance from gum brands such as Trident.

Cadbury aims to deliver sales growth of 4% to 6% a year and to see profit margins in the mid-teens by 2011, under a plan which will also see 7,800 jobs cut and 15% of its factories worldwide close in a radical cost-reduction programme.

It ranks as number one or two in more than 20 of the world's top 50 markets, with popular products such as the Creme Egg, Flake and its growing chewing gum brand Trident.

There has been speculation that Cadbury may seek a tie-up with other groups to further boost its size and scale after the Mars deal to buy Juicy Fruit and Extra maker Wrigley for around 23 billion US dollars (£11.6bn).

Experts said the merger would spark consolidation in the confectionery market, with Cadbury tipped to look at a possible deal with number one US chocolate group Hershey.

Cadbury has a history dating back nearly 200 years, with its famous Dairy Milk chocolate first launched in 1905. Other brands owned by the group now include Green and Black's, Bubbaloo gum and Bassett's.

* The shares closed on Friday on 640p compared with Cadbury Schweppes' Thursday closing price of 574p.