Imperial Tobacco to buy U.S. cigarette brands for $7.1 billion
Reuters
Published Jul 15, 2014 07:55AM ET
Imperial Tobacco to buy U.S. cigarette brands for $7.1 billion
LONDON (Reuters) - Imperial Tobacco Group (L:IMT) plans to buy U.S. cigarette brands including Winston and Kool for $7.1 billion as part of Reynolds American's (N:RAI) $27.4 billion purchase of Lorillard (N:LO).
Imperial's purchase, meant to ease antitrust concerns from the marriage of the United States' No. 2 and No. 3 tobacco firms, also includes Maverick, Salem and the international and U.S. rights to the nation's leading e-cigarette brand, blu.
After adjusting for the present value of tax benefits, expected at $1.5 billion, Imperial said the net price of $5.6 billion implies a multiple of 6.9 times the brands' earnings before interest, tax, depreciation and amortization.
Reynolds, maker of Camel cigarettes, agreed on Tuesday to buy Newport-maker Lorillard, for $68.88 per share, or $27.4 billion.
(Reporting by Martinne Geller in London. Editing by Jane Merriman)
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