Imperial boss clinches a $7bn US tobacco deal
IMPERIAL Tobacco helped to push the FTSE up yesterday, as shares jumped after the company got the green light from the US Federal Trade Commission to move forward with its plans to acquire several US tobacco brands.
Shares in the company closed at 3,393p, up by 3.32 per cent, after announcing that it had moved one step closer to completing the deal it first unveiled in July last year, which will be the biggest transaction carried out by Imperial under the leadership of Alison Cooper if it goes ahead.
The group is offering $7.1bn (£4.6bn) for US brands owned by Reynolds and Lorillard, including four cigarette brands – Winston, Maverick, Kool and Salem – and one e-cigarette business: Blu, which operates in both the US and the UK.
A spokesman for Imperial said yesterday that this acquisition would represent the biggest deal for the company “since at least 2009”.
The company currently has a three per cent market share in the US, but said the proposed acquisition would push that share closer to the 10 per cent mark.
Meanwhile, taking control of e-cigarette brand Blu would immediately give Imperial the lead position in that market in the US.
Mike van Dulken at Accendo Markets said that yesterday’s announcement put an end to over 10 months of uncertainty about whether the deal would be signed off, and noted that Imperial was back to “near all-time highs on the basis that it is set to become the new number three player in the $100bn US market”.