March 3 U.S. tobacco company RJ Reynolds
is exploring a bid for rival Lorillard Inc,
the Financial Times reported, citing people familiar with the
The deal is expected to value Lorillard Inc, known for its
Newport menthol cigarettes, in excess of $20 billion, the paper
Lorillard shares jumped about 10 percent to $54.07 in
afternoon trading on the New York Stock Exchange, valuing the
company at about $19.6 billion.
RJ Reynolds has appointed investment bank Lazard to explore
the deal but it is unclear if the company is planning to buy all
of Lorillard or a part of it, the paper reported. ()
A deal could give RJ Reynolds, whose brands include Camel
and Kool cigarettes, more than 35 percent of the North American
market, the paper said.
RJ Reynolds and its largest shareholder British American
Tobacco declined to comment. BAT, which sells Lucky
Strike and Kent cigarettes, owns about 42 percent of RJ
Lorillard could not immediately be reached for comment.
Most U.S. cigarette companies are grappling with declining
sales due to government regulation and health-aware consumers
and are venturing into the fast-growing electronic cigarettes