Reynolds, Lorillard Set Date for Merger Vote
NEW YORK — Shareholders of Reynolds American Inc. (RAI) and Lorillard Inc. will vote on the proposed merger between the two companies on Jan. 28, according to a Seeking Alpha report.
Under the terms of the $27.4-billion merger, Winston-Salem, N.C.-based RAI will buy Greensboro, N.C-based Lorillard and keep the Newport, True and Old Gold brands.
A closing date for the merger is expected in the first half of 2015 after the Federal Trade Commission (FTC) finishes its antitrust review. In August, the FTC requested further information on the deal and the planned divestiture of several brands to Imperial Tobacco Group plc, as CSNews Online previously reported.
Once the RAI-Lorillard transaction closes, Imperial Tobacco is expected to pay $7.1 billion for the Winston, Kool and Salem brands from RAI and the Maverick and blu eCig brands from Lorillard. In addition, Imperial Tobacco will acquire Lorillard's infrastructure, which includes the company's manufacturing facility, headquarters offices, research and development facility, and approximately 2,900 employees.
These acquisitions will build on Imperial's existing U.S. portfolio at Commonwealth-Altadis, which currently accounts for a 3-percent share of the U.S. market, principally through the USA Gold brand. The deal will make Imperial Tobacco the third-largest U.S. tobacco company with a 10-percent share of the cigarette market.