Reynolds confirms $25bn Lorillard merger
Reynolds American said it would buy rival Lorillard for about $25bn (€18bn), merging two of the world's biggest cigarette makers amid a slowdown in sales.
Reynolds, whose brands include Camel and Pall Mall, offered $68.88 per Lorillard share, representing a premium of 2.5pc to Lorillard's Monday closing.
Lorillard's shares have risen about 37pc since reports in February of a possible deal. They were down 5.5pc at $63.50 before yesterday's bell.
The deal gives Reynolds, the second-largest cigarette maker in the US, the leading US menthol cigarette Newport.
Analysts say the deal will help the players compete with Altria Group in the US where sales volume is falling about 4pc a year as more Americans quit smoking.