R.J. Reynolds to merge with Brown & Williamson

Manufacturing News, Source : TheManufacturer.com
Published : 28 Oct 2003 15:45

The second-largest U.S. tobacco company, R.J. Reynolds, announced an agreement yesterday to merge with British American Tobacco’s U.S. operation Brown & Williamson, the third-largest U.S. tobacco company.

The new company, Reynolds American, will have approximately a 30 percent market share, and be the second-largest tobacco company in the U.S., behind Altria’s Philip Morris. R.J. Reynolds will pay $2.6 billion in cash and stock to British American for a 58% stake in the new company.

However, R.J. Reynolds posted a $3.45 billion third-quarter net loss today due to recent restructuring. Last month, the company announced the layoff of 40% of its workforce, or 2,600 workers.

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