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RJ Reynolds considering bid for Lorillard: FT
[March 04, 2014]
(Reuters) — The U.S. tobacco company RJ Reynolds <RAITH.UL>
is exploring a bid for rival Lorillard Inc <LO.N>, the
Financial Times reported, citing people familiar with
the situation. The deal is expected to value Lorillard Inc, known for its Newport menthol cigarettes, in excess of $20 billion, the paper reported. |
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Lorillard shares jumped about 10 percent to
$54.07 in afternoon trading on the New York Stock Exchange,
valuing the company at about $19.6 billion. RJ Reynolds has appointed investment bank Lazard to explore the
deal but it is unclear if the company is planning to buy all of
Lorillard or a part of it, the paper reported. (http://link.reuters.com/sas37v) A deal could give RJ Reynolds, whose brands include Camel and
Kool cigarettes, more than 35 percent of the North American
market, the paper said. RJ Reynolds and its largest shareholder British American Tobacco
<BATS.L> declined to comment. BAT, which sells Lucky Strike and
Kent cigarettes, owns about 42 percent of RJ Reynolds. Lorillard could not immediately be reached for comment. Most U.S. cigarette companies are grappling with declining sales
due to government regulation and health-aware consumers and are
venturing into the fast-growing electronic cigarettes market. (Reporting by Tasim Zahid in Bangalore; editing by Saumyadeb Chakrabarty) [© 2014 Thomson Reuters. All rights reserved.] Copyright 2014 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
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