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Philip Morris International Inc. (NYSE / Euronext Paris: PM) announced today that it has extended the expiry of its CAD $30.00 per share cash offer to purchase all of the outstanding common shares of Rothmans Inc. (Rothmans).
The extension is procedural, being related to the last remaining regulatory approval required for the transaction, namely a determination of net benefit by the Minister of Industry pursuant to the Investment Canada Act.
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Altria Group Inc.'s pursuit of snuff maker UST Inc. may mean that Lorillard Inc., the manufacturer of Newport menthol cigarettes, is the next target as the U.S. tobacco industry consolidates.
A UST acquisition might compel Reynolds American Inc., the second-largest U.S. tobacco company, to bid for the Greensboro, North Carolina-based cigarette manufacturer, said Nik Modi, an analyst at UBS Securities LLC, and investor Matthew Kaufler. Lorillard, with a market value of $12.9 billion, climbed 6.4 percent yesterday in New York trading.
Altria, the maker of the top-selling Marlboros, may offer at least $10 billion, or $68 a share, for UST, the producer of top-selling Skoal and Copenhagen snuff, people with knowledge of the talks said. Shrinking sales in the $70 billion U.S. cigarette industry may force companies to combine, while waning legal risk may attract international suitors.
Investors ``are sniffing out the next deal in tobacco,' . . .
Waning legal risk after U.S. tobacco makers prevailed in three multibillion-dollar lawsuits may draw overseas producers to the U.S.
WHAT THE COMPANIES SAY: Altria Group, which owns Marlboro-maker Philip Morris USA, called a New York Times report that it would buy rival UST Inc. for more than $10 billion ''pure speculation.'' UST declined to comment.
WHAT ANALYSTS SAY: Observers say Philip Morris USA has long considered buying UST for the company's smokeless products. Smokeless sales are growing as Americans buy fewer cigarettes.
Cigarette company Altria Group Inc (MO.N) is in advanced talks to buy Skoal and Copenhagen smokeless tobacco maker UST Inc (UST.N), a source familiar with the discussions told Reuters on Friday.
The New York Times reported that a deal worth more than $10 billion could be announced on Monday or even sooner. The source could not confirm the price or say when a deal might be announced. . . .
Buying UST would be a quick way for Altria to expand in the growing smokeless tobacco market as the company looks to branch out from a U.S. cigarette market in steady decline. Altria, whose Philip Morris USA unit makes Marlboro cigarettes, has already tried to expand by test-marketing smokeless tobacco products under the Marlboro name.
"It expands their portfolio," Ken Harris of consumer products consulting firm Cannondale Associates said of a possible deal for UST. "They get into a major smokeless tobacco business."
Altria Group, which owns Marlboro-maker Philip Morris USA, said Friday that a report of its impending acquisition of UST was "pure speculation." Analysts said the deal makes perfect sense. . . .
So parent company Altria bought cigar maker John Middleton Inc. in December 2007, and Philip Morris USA has tried to sell smokeless products under its own brands. The company's efforts to sell Marlboro-brand smokeless products has not gone especially well, analysts say.
"If it is a raging success, I think we would hear much more in the way of chest-thumping than we have," Kaufler said.
Altria Group Inc., the maker of Marlboro cigarettes, is in talks to buy UST Inc., the largest U.S. snuff producer, for more than $10 billion, people with knowledge of the negotiations said.
A bid that size would value UST at 26 percent more than yesterday's closing price. UST, which produces Skoal and Copenhagen smokeless tobacco, and Altria are in advanced discussions, and an announcement may come next week, said the people, who declined to be identified because the talks aren't public.
Acquiring UST would give Altria about 60 percent of U.S. shipments of snuff, a $3.7 billion industry that's growing about 7 percent a year. Altria expects cigarette consumption to decline
Altria Group, which owns Richmond-based Philip Morris USA, said today that a report of its impending acquisition of UST was "pure speculation." Analysts said the deal makes perfect sense.
The New York Times reported late Thursday that Altria, which owns the nation's biggest cigarette maker, was in discussions to buy UST for more than $10 billion. . . .
"From a strategic point of view, [the] logic of a deal looks indisputable," Deutsche Bank analyst Marc Greenberg wrote in a note to investors. Greenberg said UST is dominant in the smokeless tobacco business, which is an expanding part of total tobacco profits and growing at 6 percent or 7 percent this year.
There's no smoke, but somebody thinks there's a fire brewing at UST (UST). The smokeless tobacco products maker has been the subject of myriad rumors that it might be in the cross-hairs of a bigger tobacco player - Altria (MO) being the name that comes up most frequently - that would be interested in expanding beyond the traditional cigarette business. UST effectively fanned the flames Thursday. The company aburptly canceled a scheduled appearance at a Lehman Brothers conference on consumer companies. UST said the executives expected to make the presentation, including CEO Murray Kessler, had a ''scheduling conflict," and then declined to elaborate.
Faculty and students told a Virginia Commonwealth University panel that they're concerned about the moral and ethical implications of entering research agreements with tobacco giant Philip Morris USA and other corporations.
Wednesday's meeting was the final one held by the task force, formed in the wake of a controversy over a consulting contract between VCU and Richmond-based Philip Morris USA.
The group is expected to consider whether to refuse research funding from tobacco companies, as several other schools have, and will issue its recommendations to VCU President Eugene P. Trani by Oct. 1.
A number of speakers told the task force that the university should rethink whether its researchers should sign "work-for-hire" agreements with Richmond-based Philip Morris, a unit of Altria Group Inc. The forum was open only to faculty, staff and students.
Troy lawyer Gerard V. Mantese is taking on the tobacco industry. . . .
Now, with a lawsuit against Philip Morris pending before the U.S. Supreme Court, Mantese has his chance to do just that.
"In 2004, I put together a consortium of law firms in several states ... with the goal of representing consumers who were defrauded by Philip Morris [when it] falsely represented that its Marlboro Lights had 'lowered tar and nicotine,'" he explained.
Since then, Mantese has filed lawsuits in Maine, Arkansas and New Mexico accusing Phillip Morris of violating each state's prohibition against deceptive advertising.
"All of the cases are based on the same theory: Philip Morris misrepresented the true nature of its so-called 'light' cigarettes [because] it represented that they contained lower [amounts of] tar and nicotine ... when a multitude of data, internal documents and evidences proves otherwise," he said.
One case, Altria Group, et al., v. Good, et al., has landed Mantese before the U.S. Supreme Court.
Mr. Bloomberg and the city's public advocate, Betsy Gotbaum, also disclosed their financial holdings on Wednesday.
Ms. Gotbaum, who in her last disclosure reported a stock portfolio valued at $184,000 to $1.2 million, as part of her holdings, successfully sought to keep the latest list of her individual stock holdings private. The list covering 2006 included names such as Altria, the owner of the cigarette maker Philip Morris, and Halliburton, the defense contractor.
This time around, instead of disclosing her stocks one by one, Ms. Gotbaum's disclosure form simply indicates that stocks she holds are currently managed by Sanford C. Bernstein & Company, in accounts totaling $200,000 to $500,000.
A Gotbaum spokeswoman said the city determined she did not have to list the individual stocks as long as an investment manager, rather than she, chose the stocks.
A tobacco control advocate group on Friday asked the Eraserheads to declare its reunion concert a "smoke-free" gig.
"We hope the concert will truly be smoke-free," said Dr. Maricar Limpin, executive director of the Framework Convention on Tobacco Control Alliance Philippines (FCAP).
The call was made as FCAP claimed victory in the Philippine Morris Philippines Manufacturing decision to pullout from the reunion concert's sponsorship.
"Now, we will all be able to watch the concert without fear of being polluted by advertising ploys of deadly products," Limpin added.
Philip Morris International Inc., the world's largest publicly traded tobacco company, and utility E.ON AG led 16.6 billion euros ($24.5 billion) of European corporate bond sales this week, the most in two months.
Sales jumped from 6.8 billion euros last week and from 6.5 billion euros the week before, according to data compiled by Bloomberg. New York-based Philip Morris raised a total of 1.75 billion euros in its first sale in the common European currency, prompted by concern credit conditions may deteriorate.
``We wanted to be ahead of the game and issue a smaller- sized transaction at current market spreads,'' Marco Kuepfer, vice-president and treasurer of Philip Morris, said in an interview.
In the Philippines, Philip Morris International withdrew after health advocates protested the company's involvement and the Philippines Department of Health warned the company that its sponsorship and related marketing violated the country's tobacco regulation law. The law prohibits all forms of tobacco advertising in mass media including the Internet, places strict restrictions on other tobacco promotional activities, and bans tobacco company sponsorship of concerts and other events.
We applaud the Philippines Department of Health for setting an international example by taking aggressive action to enforce the country's tobacco control law and protect Filipino children from this blatant effort to market cigarettes to them. With this action, the Philippines government is taking seriously its obligations under the World Health Organization's international tobacco control treaty, the Framework Convention on Tobacco Control, which among other things calls on ratifying nations to ban all tobacco advertising, promotions and sponsorships.
Nations should act quickly to implement this and other provisions of the treaty and protect their children
AUSTRALIA'S world MotoGP champion and Young Australian of the Year, Casey Stoner, is being named and shamed in an aggressive campaign by anti-smoking groups which have labelled him as a "high-speed drug pusher."
They said images of the 22-year-old non-smoker and his bike covered in logos of Marlboro cigarettes while racing and in the media are sending the wrong message to his fans, particularly impressionable young children.
The anti-tobacco group Action on Smoking and Health, the youth health project Smarter than Smoking and the Australian Network on Young People and Tobacco have written to Stoner and his management at Ducati calling on him to relinquish his sponsorship deal with tobacco giant Philip Morris.
The groups claim he is being used as a "Marlboro Man" to promote addictive, lethal products, and although tobacco sponsorship and advertising is banned in Australia, images featuring him plastered in tobacco logos can be readily seen in the media.
They have also written to the National Australia Day Council saying they are concerned that its Young Australian of the Year is actively promoting smoking to the rest of the world.
But in an emailed response last week, Stoner said that while he understood their views and agreed that children should not smoke, he did not believe Philip Morris's sponsorship of Ducati was aimed at young people.
Casey Stoner is the new Marlboro Man and while he might have a lucrative contract with his sponsor, as a champion he is a role model to children and young people worldwide and he's being exploited as a high-speed drug pusher.ASH chief executive Anne Jones, on Australia's world MotoGP champion and Young Australian of the Year, Casey Stoner--whose racing suit and motorcycle are covered in Marlboro logos.