British American Tobacco's Bid To Create Worlds Biggest Tobacco Company
British American Tobacco (BAT) has offered €43 billion for Reynolds American to create biggest tobacco company in the world, reports IrishExaminer.com
Its brands include Newport, Lucky Strike, and Pall Mall. The cash-and-stock deal would mark the return of BAT, which currently owns Irish cigarette company PJ Carroll company after a 12-year absence.
The British company has been benefiting from a strong share price the Brexit vote. The buy out will also bolster the companies growth significantly, as it can increase its portfolio with other premium brands such as Camel, which it can sell in countries such as Russia and Turkey where demand for Western cigarettes is still growing.
A takeover by BAT, which already owns 42% of Reynolds, has long been seen as part of an inevitable wave of global consolidation in a mature industry. Yet the timing, less than three weeks before a US presidential election, was unexpected. “This proposed deal manages to be both entirely expected and a surprise,” Euromonitor analyst Shane MacGuill told the IrishExaminer.com
BAT has more than 200 brands in more than 200 markets.
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