Federal District Court gives Green Signal to Reynolds to Acquire Lorillard

Finally, a district court has given green signal to Reynolds American over its acquisition of Greensboro-based Lorillard Incorporated in a $27.4 billion deal, Reynolds said in a news release.

The merger that has been approved by the Federal Trade Commission in May would require Reynolds to sell four established brands to Imperial Tobacco Group's (ITG) U. S. subsidiary ITG Brands.

Under the Lorillard's sale to Reynolds, ITG would take control over Lorillard's manufacturing, headquarters and research operations in Greensboro.

The operations presently employ 2,900 people. Lorillard in a published report said that the workers will more likely work at Reynolds or ITG.

Imperial has selected Greensboro as the headquarters for the new company it will form, ITG Brands, when the complex deal is complete.

Imperial is planning to buy several current Reynolds and Lorillard cigarette brands for $7.1 billion as part of the three-way deal that was announced in July, 2014.

The Federal Trade Commission (FTC) said that its order requires Reynolds to divest to Imperial four established cigarette brands: Winston, Kool, Salem and Maverick.

It has been said that Reynolds is also selling Lorillard's dominant Blu e-cigarette brand to Imperial.

Reynolds will keep Lorillard's best-known cigarette brand, Newport said resources familiar with the issue.

Imperial's United States subsidiary, Commonwealth-Altadis, already owns and operates the former American Tobacco plant in Reidsville.

Imperial said ITG Brands will be based at Lorillard's current headquarters at 714 Green Valley Road in Greensboro. It headquarters' will include Lorillard employees and a number of Commonwealth-Altadis employees who will move from Fort Lauderdale, Fla.

Susan M. Cameron, RAI's president and chief executive officer, said, "With the addition of Lorillard's strong Newport brand, RAI's operating companies will have brand portfolios that reflect diversification and strength across product categories and across geographies".