Winston-Salem-based Reynolds American Tobacco rejects British American’s $47B buyout offer
WINSTON-SALEM, N.C. — Reynolds American Tobacco rejected British American Tobacco’s $47 billion bid to take control of the Winston-Salem-based company, citing the price as being too low.
Bloomberg Markets reports the two entities are currently in negotiation talks after BAT offered to buyout Reynolds, the second-largest tobacco company in the United States, on Oct. 21. BAT is willing to increase the price but won’t go up much further.
The two cigarette giants hold some of the biggest selling brands on the planet, including Pall Mall and Kent. Combining them all would create the world’s largest listed tobacco company by net sales and operating profit.
BAT already owns about 42% of Reynolds but says it’s willing to shell out $47 billion plus to buy the remaining 58%.
The existing strong ties between the two companies means they already share some brands. For example, Reynolds has the rights to Pall Mall in the U.S., and BAT has them for more than 100 international markets.
“The proposed merger of our two great companies is the logical progression in our relationship,” BAT CEO Nicandro Durante said in a statement.
Reynolds American is the parent company of R.J. Reynolds Tobacco Company, Santa Fe Natural Tobacco Company, American Snuff Company, Niconovum USA, Niconovum AB and R.J. Reynolds Vapor Company.