Reynolds American, Lorillard in unification discussions

May 23, 2014

Deals made in a smoky space may be factually the case in this one: Lorillard and Reynolds American (RAI), both cigarette corporations, are supposedly considering an union that might institute the second major cigarette manufacturer in the US.

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Reynolds produces cigarettes like as Pall Mall cigarettes and Camel cigarettes, while Lorillard makes Newport, the principal in the menthol cigarette space. If the two united they might only track Altria Group -- which produces the extremely admired Marlboro cigarettes -- in the cigarette industry, according to Wall Street Journal information.

The move would also permit Reynolds enter the increasingly beneficial e-cigarette advertise, as Lorillard has an admired product in that space: the blu.

British American Tobacco PLC might also have a pronounce in the covenant, given that the corporation owns 42% of Reynolds. Lorillard and Reynolds both had no comment to say on the reported agreement.

It is predictable that any arrangement would have a number of anti-trust suggestions, as the newly-merged business and Altria would manage 90% from the U.S. market.