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Reynolds American completes acquisition of Lorillard

Staff writer |
Reynolds American (RAI) has completed its acquisition of Lorillard, and related divestiture transactions.

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As a result of the acquisition, Lorillard is a wholly owned subsidiary of RAI, and former Lorillard shareholders will own approximately 15 percent of RAI’s common stock.

RAI’s operating companies have key brands across major industry categories: Newport, Camel, Pall Mall and Natural American Spirit in combustible cigarettes; Grizzly in smokeless tobacco; and VUSE in the vapor market.

In the acquisition, former Lorillard shareholders will receive $50.50 in cash and 0.2909 of a share of RAI common stock for each share of Lorillard common stock they owned.

In the related divestiture transactions, subsidiaries of RAI have sold the KOOL, Salem, Winston, Maverick and blu eCigs brands, and other assets and liabilities, to ITG Brands, LLC, a subsidiary of Imperial Tobacco Group, PLC, for total consideration of approximately $7.1 billion in cash.

Additionally, British American Tobacco p.l.c. maintained its approximately 42 percent ownership in RAI through an equity investment of approximately $4.7 billion.

Reynolds American announced in July 2014 that it will acquire Lorillard in a cash-and- stock transaction currently valued at $68.88 per Lorillard share, or a total of $27.4 billion, including the assumption of net debt.

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