A look at the new big 3 in US tobacco industry

The Associated PressJuly 15, 2014 

Cigarette maker Reynolds American Inc. is planning to buy rival Lorillard Inc. for about $25 billion in a deal to combine two of the nation's oldest and biggest tobacco companies.

The deal announced Tuesday would create a formidable No. 2 to rival Altria Group Inc., owner of Philip Morris USA, and create a new player in the country's tobacco market as the companies will sell the Kool, Salem, Winston, Maverick and Blu eCigs brands to Imperial Tobacco Group for $7.1 billion to ease regulatory concerns about competition.

Here's a look at the new big three U.S. tobacco companies once the deal closes:


Headquarters: Richmond, Virginia

Brands: The owner of the nation's biggest tobacco company, Philip Morris USA, holds more than 50 percent of the retail cigarette market, led by its top-selling Marlboro brand, as well as Basic, Virginia Slims, Parliament and L&M. It also sells Black & Mild cigars, Copenhagen and Skoal smokeless tobacco and is expanding its MarkTen electronic cigarette brand nationally. Altria also owns a wine business, holds a voting stake in brewer SABMiller and has a financial services division.

Performance: Its profit rose 8.5 percent to $4.5 billion in 2013. Revenue, excluding excise taxes, rose less than one percent to $17.7 billion.

Employees: About 9,000 full-time employees.


Headquarters: Winston-Salem, North Carolina

Brands: With cigarette brands Camel, Pall Mall, Newport and Natural American Spirit cigarettes, Reynolds will have about 34 percent of the U.S. retail cigarette market and a dominant position in menthol cigarettes, an area that's gaining market share. It also sells Grizzly and Kodiak smokeless tobacco brands and Vuse brand electronic cigarettes, which expanded nationally last month.

Performance: Projected to have more than $11 billion in revenues, following the deal. Reynolds' profit rose 35 percent to $1.72 billion in 2013 on revenue of $8.24 billion, excluding excise taxes while Lorillard's profit rose 8.5 percent to $1.19 billion in 2013 on revenue of $4.97 billion, excluding excise taxes.

Employees: About 5,200 full-time employees.


Headquarters: Subsidiary Commonwealth-Altadis Inc. is based in Fort Lauderdale, Florida.

Brands: With a portfolio that will include the Kool, Salem, Winston, Maverick and USA Gold brands, Imperial will have about a 10 percent share of the U.S. cigarette market. The Blu eCig brand accounts for almost half of all e-cigarettes sold and expanded globally with Lorillard's acquisition of U.K.-based electronic cigarette maker Skycig last year.

Performance: Imperial says its U.S. business is expected to 24 percent of its net tobacco revenues, which totaled about $12 billion in its latest fiscal year.

Employees: About 800 full-time employees in the U.S. As part of the deal, it will acquire about 2,900 full-time employees from Lorillard, along with its manufacturing plant and other offices.

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