Daily Management Review

BAT Proposes A ‘$47 Billion’ Merger Deal To Reynolds American Inc.


10/22/2016


If BAT’s proposed offer were to realise, the company would take a leading place in the “high value” market of the United States.



BAT, meaning the British American Tobacco, has put up an offer of purchasing Reynolds American Inc’s “U.S. tobacco company” for a deal of “$47 billion”, whereby bringing “Newport, Kent and Pall Mall cigarettes” together under the “biggest listed tobacco company” in the world.
 
From the above-mentioned takeover, BAT achieve a “leading position in the high-value United States market”, while it can sell “more premium brands” in the countries guided by their demands. BAT already holds forty two percent Reynolds’ stake, while the offer values its shares at “$56.50”.
 
Investec Wealth & Investment’s analyst, Guy Ellison, thinks that the “strategic rationale (of the deal) makes perfect sense”, as it would push BAT further in the “high value” market of the U.S., and the process it would consolidate “some strong brands and Reynold's position in ‘next generation tobacco’ products”.
 
Other cost collaborations involved in the “proposed merger”, as per BAT’s estimations come around “$400 million”. However, Reynolds has not yet responded to BAT’s proposition.
 
According to Reuters:
“The tie-up is also one of the only mega deals left in a global tobacco industry which is already dominated by six companies, and it would create the only player with a major presence in both U.S. and international markets”.
 
 
 
References:
http://www.reuters.com/







Science & Technology

Large U.S. Study Finds Detection Of Irregular Heart Beat By Apple Watch

Apple to present Netflix competitor at the end of March

Live Human Under-Skin Chip Implantation Takes Place At Barcelona

IDC: Wearable tech gadgets market is booming

Second Patient In 12 Years Becomes HIV Free By Bone Marrow Transplantation

Car-Sharing Platforms Could hold The Key To 5G & Auto Industry Collaboration

Bezos tells about his space plans

Fast Company: Apple isn't the most innovative anymore

U.S. Space Program Could Be Delayed Due To SpaceX, Boeing Design Risks: Reuters

What trends will be affecting the health sector in the coming years?

World Politics

World & Politics

China's expansion into Europe: Italy’s ports are next

US watchdog is accused of violating aircraft certification process

Large Section Of Citizens Unhappy With Public Services & Benefits: OECD Survey

Largest companies reveal volumes of plastic produced by them

US Warning To Germany About Intelligence Sharing Over Huawei Ban

Mercer reveals the world’s safest cities

No vaccinations, no school: Italy’s new law

Why the new Aachen Treaty cannot save France-Germany relation