BUZZ-Smiths: shares jump on ValueAct's reported investment

(Adds share movement, milestones, details from source)

** Smiths Group (Other OTC: SMGKF - news) up c.8 pct, top FTSE-100 gainer & on track for sharpest one-day gain in over 4.5 yrs on news that U.S. activist investor ValueAct has a stake in the British engineering conglomerate

** ValueAct has held a stake for a while source close to matter tells Reuters, without specifying the size of the stake

** Smiths and ValueAct are not required to make a public disclosure if stake size is below the 5 pct statutory disclosure level set by the London Stock Exchange (Other OTC: LDNXF - news)

** FT quotes sources as saying that ValueAct views Smiths' medical devices unit and its John Crane seals unit as potential M&A targets (http://bit.ly/1SWRfze)

** Smiths said in September it was not planning to sell the ailing medical unit, where suffering margins have prompted calls for a sale; shares have slid 9 pct since

** ValueAct immediately unavailable to comment outside of regular business hours in the U.S.

** Smiths hits high of 1243, still trading c.8 pct below the StarMine intrinsic value estimate

** The report on ValueAct a few days after the activist fund reported a stake in Rolls-Royce

** More shares traded hands in first c.1.5 hr of trading than a full-day's avg volume (RM (LSE: RM.L - news) : esha.vaish.thomsonreuters.com@reuters.net)