IRS Issues Favorable Ruling on Pending Merger of Reynolds Tobacco and Brown & Williamson
2004年6月23日 - 7:48AM
PRニュース・ワイアー (英語)
IRS Issues Favorable Ruling on Pending Merger of Reynolds Tobacco
and Brown & Williamson WINSTON-SALEM, N.C., June 22
/PRNewswire-FirstCall/ -- R.J. Reynolds Tobacco Holdings, Inc.
(NYSE:RJR) announced today that its R.J. Reynolds Tobacco Co.
(RJRT) subsidiary and Brown & Williamson Tobacco Corp.
(B&W) have received favorable private-letter rulings from the
Internal Revenue Service in connection with the proposed
combination of RJRT and the U.S. business of B&W. The IRS
rulings confirm that the proposed combination of those companies'
U.S. businesses will be tax-free to RJR shareholders and B&W's
parent company, British American Tobacco p.l.c. (AMEX:BTI), under
existing Federal tax law and regulations. The agreement between RJR
and British American Tobacco (BAT) to combine RJRT and B&W
provides for establishing a new publicly traded holding company
called Reynolds American Inc., which will become the parent company
of the newly combined RJRT and B&W U.S. businesses. In
addition, Reynolds American Inc. will pay $400 million in cash to
acquire Lane Limited, which manufactures several cigar,
roll-your-own and pipe tobacco brands and distributes Dunhill
tobacco products. Reynolds American Inc. will have approximately
150 million shares outstanding. Under the agreement, BAT will own
42 percent of Reynolds American Inc. stock, with existing RJR
shareholders owning 58 percent through a one-for-one exchange for
stock of the new company. As the company has previously stated,
other key rulings and approvals that are necessary prior to closing
the transaction include clearance by the U.S. Federal Trade
Commission (FTC), clearance by the Securities and Exchange
Commission (SEC) of the proxy statement/prospectus for RJR
shareholders, and RJR shareholder approval. Reynolds Tobacco is the
second-largest U.S. cigarette manufacturer and marketer. RJRT's key
brands include Camel, Salem, Winston and Doral. Brown &
Williamson is the third-largest domestic cigarette company.
B&W's brands include KOOL, Pall Mall, Lucky Strike and Misty.
Forward-Looking Information Statements included in this news
release which are not historical in nature are forward-looking
statements made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Forward- looking
statements regarding RJR's future performance and financial results
include risks and uncertainties that could cause actual results to
differ materially from those described in the forward-looking
statements. These risks include the substantial and increasing
regulation and taxation of the cigarette industry; various legal
actions, proceedings and claims relating to the sale, distribution,
manufacture, development, advertising, marketing and claimed health
effects of cigarettes that are pending or may be instituted against
RJR or its subsidiaries; the substantial payment obligations and
limitations on the advertising and marketing of cigarettes under
various litigation settlement agreements; the continuing decline in
volume in the domestic cigarette industry; competition from other
cigarette manufacturers, including increased promotional activities
and the growth of the deep-discount category; the success or
failure of new product innovations and acquisitions; the
responsiveness of both the trade and consumers to new products and
marketing and promotional programs; any potential costs or savings
associated with realigning the cost structure of RJR and its
subsidiaries; the ability to achieve efficiencies in manufacturing
and distribution operations without negatively affecting sales; the
cost of tobacco leaf and other raw materials and commodities used
in products; the effect of market conditions on the performance of
pension assets, foreign currency exchange rate risk, interest rate
risk and the return on corporate cash; and the ratings of RJR
securities. In addition, RJR can give no assurance that the
proposed formation of Reynolds American Inc., the combination of
RJRT and the U.S. assets, liabilities and operations of B&W,
and the related transactions, will be consummated, or if
consummated, that any expectations relating thereto will be
realized. Factors that could affect whether these transactions are
consummated include obtaining clearances from the FTC and the SEC,
the approval of RJR shareholders and the satisfaction or waiver of
certain other conditions. Due to these uncertainties and risks,
undue reliance should not be placed on these forward- looking
statements, which speak only as of the date of this news release.
Except as provided by federal securities laws, RJR is not required
to publicly update or revise any forward-looking statement, whether
as a result of new information, future events or otherwise.
Additional Information and Where To Find It Reynolds American Inc.,
the holding company formed in connection with the proposed business
combination, has filed a registration statement on Form S-4 that
includes a preliminary proxy statement/prospectus and other
relevant documents in connection with the proposed business
combination. When the registration statement becomes effective, a
final proxy statement/prospectus and other relevant documents will
be mailed to RJR shareholders. INVESTORS AND SECURITY HOLDERS OF
RJR ARE URGED TO READ THESE DOCUMENTS WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
BUSINESS COMBINATION. Documents filed by RJR and Reynolds American
Inc. with the SEC can be found at the SEC's Web site at
http://www.sec.gov/ . Once available, free copies of the final
prospectus/proxy statement, as well as RJR's and Reynolds American
Inc.'s related filings with the SEC, also may be obtained from RJR
by directing a request to R.J. Reynolds Tobacco Holdings, Inc. at
P.O. Box 2866, Winston-Salem, NC 27102-2866, Attn.: Office of
Investor Relations, or by telephone at (336) 741-5165 or on RJR's
Web site, http://www.rjrholdings.com/ . Interests of Participants
RJR, its directors and executive officers and certain other members
of management and employees may be deemed to be participants in the
solicitation of proxies from RJR shareholders in favor of the
proposed business combination. A description of the interests of
the directors and executive officers of RJR is set forth in the
prospectus/proxy statement and the other relevant documents filed
with the SEC. R.J. Reynolds Tobacco Holdings, Inc. is the parent
company of R.J. Reynolds Tobacco Company and Santa Fe Natural
Tobacco Company, Inc. R.J. Reynolds Tobacco Company is the
second-largest tobacco company in the United States, manufacturing
about one of every five cigarettes sold in the United States.
Reynolds Tobacco's product line includes four of the nation's 10
best-selling cigarette brands: Camel, Winston, Salem and Doral.
Santa Fe Natural Tobacco Company, Inc. manufactures Natural
American Spirit cigarettes and other tobacco products, and markets
them both nationally and internationally. Copies of RJR's news
releases, annual reports, SEC filings and other financial materials
are available on the company's website, http://www.rjrholdings.com/
. DATASOURCE: R.J. Reynolds Tobacco Holdings, Inc. CONTACT: Jan
Smith, +1-336-741-6995, or cell, +1-336-829-9258, or Maura Payne,
+1-336-741-6996, or cell, 336829-9024, both of R.J. Reynolds
Tobacco Holdings, Inc. Web site: http://www.rjrholdings.com/
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