Reynolds American Will Remain Headquartered in Winston-Salem
Cigarette maker Reynolds American Inc. is planning to buy rival Lorillard for about $27 billion in a deal to combine two of the nation's oldest and biggest tobacco companies.
The acquisition would also bring Newport, one of the top cigarette brands in the country, under the umbrella of Reynolds American.
“The complimentary regional strengths of each company and the Camel and Newport brands will be a factor in future revenue growth. The companies and specifically these brands do not overlap in these markets,” said Susan Cameron, president and CEO of Reynolds American.
According to Cameron, British American Tobacco will invest $4.7 billion to maintain their 42 percent ownership in Reynolds American. As part of the transaction, Imperial Tobacco will be purchasing the KOOL, Salem, Winston, Maverick and Blu eCigs assets of Reynolds and Lorillard.
Imperial is the fourth largest tobacco company in the world by market share and their brands are sold in more than 160 counties.
Murray Kessler, chairman, president and CEO of Lorillard explains some of the changes that will take place in Greensboro once the acquisition is complete. “Imperial is also acquiring Lorillard’s headquarters, as well as the manufacturing & R & D facilities in Greensboro, North Carolina and Danville, Virginia and almost all of our sales force. I’m convinced that they have strong plans to make them a strong number three player in the tobacco industry, but I will leave that for their conference call.”
The deal will be subject to shareholder and federal regulatory approval. Reynolds American officials expect to complete the acquisition of Lorillard in the first half of 2015.
Under the terms of the transaction, Susan Cameron, will continue in her role at Reynolds after completion of the acquisition, and the company will remain headquartered in Winston-Salem. N.C.
Lorillard's Murray Kessler will join RAI’s board after the closing of the transaction.
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