$47 billion offer to create world’s biggest tobacco company
LONDON — British American Tobacco has offered to buy out Reynolds American Inc. for $47 billion in an attempt to gain a strong presence in the U.S., a lucrative market where sales of electronic cigarettes are booming as traditional smoking fades.
The takeover would create the world’s largest publicly traded tobacco company and combine BAT’s presence in developing countries, where anti-smoking campaigns are not as strong as in the U.S. and Europe, with Reynolds’ almost exclusive focus on the U.S.
BAT already owns 42 per cent of Reynolds and sells Dunhill, Rothmans and Lucky Strike cigarettes. Reynolds controls about a third of the U.S. market with brands like Newport, Camel and Pall Mall.
Though smoking in the U.S. is declining, it remains “the largest global profit pool” outside of China, BAT said in a statement Friday. The U.S. is one of the biggest markets for e-cigarettes.