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Lorillard, Inc. (LO)

  • Wed, Nov. 18, 7:22 AM
    | Wed, Nov. 18, 7:22 AM | 16 Comments
  • Fri, Oct. 2, 7:35 AM
    • The Obama administration is pushing for a provision in the Trans-Pacific Partnership to limit the ability of tobacco companies to use tribunals to attack anti-smoking laws. The industry has used the tribunals aggressively in emerging markets.
    • Bipartisan support in Washington will be needed to pass the trade agreement next year.
    | Fri, Oct. 2, 7:35 AM | 30 Comments
  • Tue, Sep. 15, 1:00 PM
    • The FDA issued orders today that will stop the sale and distribution of four cigarette brands from R.J. Reynolds (RAI -0.4%): Camel Crush Bold, Pall Mall Deep Set Recessed Filter, Pall Mall Deep Set Recessed Filter Menthol and Vantage Tech 13. According to the agency, it took action because the company's submissions for the products did not meet the requirements set forth in the Federal Food, Drug and Cosmetics Act.
    • Specifically, the FDA's evaluation found that the products were not substantially equivalent (NSE) to their respective "predicate" products (commercially available as of February 15, 2007) as specified by the company. The agency concluded that the products have different characteristics than the predicate products and Reynolds failed to show that the new products do not raise different questions of public health when compared to them.
    • The four products entered the market during a provisional period established by the Family Smoking Prevention and Tobacco Control Act of 2009. The provision specified that the company had to submit a substantial equivalence (SE) application to the FDA by March 22, 2011 in order for the products to remain on the market.
    • The scientific basis for the action include a failure to demonstrate that increased yields of harmful or potentially harmful constituents, higher levels of menthol and/or the addition of new ingredients versus the predicates do not raise different questions of public health.
    • The NSE order means that it is illegal to sell or distribute the products in interstate commerce, including products currently in inventory.
    • Related tickers: (MO +2.3%)(BTI +0.9%)(LO)(PM +1%)
    | Tue, Sep. 15, 1:00 PM | 35 Comments
  • Sat, Sep. 12, 10:27 AM
    • There's a different approach to electronic cigarettes developing in the U.S. and U.K.
    • Health advocates in the U.S. continue to raise concerns on the impact on teenagers, including a damaging article in JAMA Pediatrics, and politicians are eyeing taxing the product. No great surprise, but Chicago and New York are out in front of the e-cig tax movement.
    • U.S. sales have been held back a bit by efforts to demonize the product, according to some company officials.
    • The reception in the U.K. to the burgeoning e-cig industry has been warmer. A government health body determined last month that e-cigarettes could be prescribed by doctors in the nation as an effective way to help smokers break their addiction.
    • A study by the same group estimated e-cigs are 95% less harmful than traditional cigarettes and found no evidence the product acts as a gateway to smoking for children or non-smokers. That last part was also backed up in a concise breakdown by
    | Sat, Sep. 12, 10:27 AM | 37 Comments
  • Tue, Jun. 16, 7:06 AM
    | Tue, Jun. 16, 7:06 AM | 37 Comments
  • Tue, Jun. 9, 1:02 PM
    • Reynolds American (RAI +1.8%) is offering a seven-part bond deal in order to fund its acquisition of Lorillard (LO +0.5%).
    • The $9B bond sale will be one of the larger corporate offerings seen this year in the U.S.
    • The development in the bond market isn't being ignored by Moody's which downgraded the tobacco company's senior unsecured rating to Baa3 on a Stable outlook.
    • "The downgrade reflects our expectation of much higher leverage as a result of the transaction, as well as execution risk in achieving synergies in a timely fashion," summarizes Moody's.
    | Tue, Jun. 9, 1:02 PM | 5 Comments
  • Mon, Jun. 8, 12:59 PM
    • Reynolds American (RAI -1.5%) announces its deal to acquire Lorillard (LO) will close on June 12.
    • The company is able to move forward after a federal judge approved a plan to divest the Maverick, Kool, Salem, and Winston cigarette brands to Imperial Tobacco Group (OTCQX:ITYBY, OTCPK:ITYBF) for $7.1B.
    | Mon, Jun. 8, 12:59 PM | 3 Comments
  • Fri, Jun. 5, 8:09 AM
    • Reynolds American (NYSE:RAI) announces it will begin exchanging notes and consent solicitations for senior notes of Lorillard (NYSE:LO) in advance of the merger between the companies.
    • The major impact of the tobacco industry merger is that the new combined entity will stand as the second largest tobacco company behind Altria (NYSE:MO) and strengthen Imperial Tobacco's (OTCQX:ITYBY, OTCPK:ITYBF) position in the U.S. after it picks up some divested brands.
    | Fri, Jun. 5, 8:09 AM | 9 Comments
  • Tue, May 26, 6:47 PM
    • Reynolds American’s (NYSE:RAI) $27.4B purchase of Lorillard (NYSE:LO) wins approval from the FTC on the condition that the companies sell four cigarette brands - Winston, Kool, Salem and Maverick - to Imperial Tobacco (OTCQX:ITYBY, OTCPK:ITYBF), as expected.
    • The FTC also says RAI will have to divest to Imperial the LO manufacturing facilities in Greensboro, N.C.
    • The FTC, which spent nearly a year scrutinizing the deal, says it is satisfied the divestitures would restore market competition that would have been lost through the merger, with Imperial “positioned to be a sufficiently robust and aggressive competitor” to a combined RAI-LO and Altria (NYSE:MO).
    • RAI, which owns the Camel and Pall Mall brands, will boost its market share to ~34% by acquiring LO and its Newport brand, the top-selling menthol cigarette; MO, owner of top brand Marlboro, leads the industry with a 47% share.
    | Tue, May 26, 6:47 PM | 24 Comments
  • Fri, May 22, 7:11 PM
    • Philip Morris International (NYSE:PM) and British American Tobacco (NYSEMKT:BTI) are suing the British government over new rules starting next May that would require cigarettes to be sold in plain packages.
    • The tobacco industry is alarmed over a growing international move toward laws mandating that colorfully branded cigarette boxes be replaced with drab, uniform packages displaying prominent health warnings.
    • Separately, a U.S. appeals court today issued a split ruling on what kinds of statements tobacco companies must make in product warnings after a judge found them in violation of federal law nearly a decade ago.
    • Defendants included Altria (NYSE:MO), Reynolds American (NYSE:RAI) and Lorillard (NYSE:LO), which have battled with the Justice Department and public health advocates over the exact wording of the warning statements; today's ruling could further delay the date when any such warnings appear in public.
    | Fri, May 22, 7:11 PM | 20 Comments
  • Thu, May 21, 4:34 PM
    • Reynolds American (NYSE:RAI) and Lorillard (NYSE:LO) are expected to receive antitrust clearance for their planned merger as soon as next week, with few changes in the companies' settlement, WSJ reports.
    • RAI and LO have a financial interest in obtaining antitrust clearance and closing their deal by June 1: If they consummate the merger by then, they can save ~$240M LO would owe its shareholders in dividend payments if it remains a separate company after that date.
    • To address antitrust concerns, the companies already agreed to sell $7.1B in cigarette brands, including Winston, Salem and Kool, along with other assets to U.K.-based Imperial Tobacco.
    | Thu, May 21, 4:34 PM | 13 Comments
  • Thu, May 14, 12:39 PM
    • Lorillard (NYSE:LO) declares $0.66/share quarterly dividend, in line with previous.
    • Forward yield 3.68%
    • Payable June 10; for shareholders of record June 1; ex-div May 28.
    | Thu, May 14, 12:39 PM | Comment!
  • Fri, Apr. 17, 12:36 PM
    • Lorillard (NYSE:LO): Q1 EPS of $0.82 beats by $0.05.
    • Revenue of $1.67B (+45.2% Y/Y) beats by $490M.
    • Shares +0.17%.
    • Press Release
    | Fri, Apr. 17, 12:36 PM | 3 Comments
  • Fri, Apr. 17, 8:27 AM
    • E-cigarettes are catching on with teenagers, according to a new data read.
    • While usage of traditional cigarettes by high school students has declined, e-cigarette demand has increased significantly.
    • 13% of all high school students used e-cigs last year to top the rate they used traditional cigarettes for the first time.
    • The FDA is still working out how it will treat the e-cigarette category.
    | Fri, Apr. 17, 8:27 AM | 6 Comments
  • Fri, Apr. 10, 10:22 AM
    • Lorillard (LO +2%) and Reynolds American (RAI +2.4%) break higher on renewed chatter the FTC will decide against a lawsuit to halt the merger between the companies.
    • Earlier today, Reynolds American announced it will host its earnings conference call on April 17 at which time more details on the merger and synergy estimates could be disclosed.
    • Lorilalrd trades at an all-time high, while Reynolds American is only a dollar and change from a 52-week top.
    | Fri, Apr. 10, 10:22 AM | 5 Comments
  • Thu, Apr. 2, 5:50 PM
    • The WSJ reports the FTC is "considering possible settlement terms" that would allow Reynolds (NYSE:RAI) to go through with its $25B acquisition of Lorillard (NYSE:LO).
    • Some FTC staffers have reportedly raised objections to a deal, which would combine the country's #2 and #3 cigarette makers (trailing Altria). But "other key figures within the commission believe the better approach would be to approve the merger with a binding legal settlement that includes divestitures."
    • As it is, Reynolds/Lorillard have agreed to sell a slew of assets to Imperial Tobacco for $7.1B. The WSJ states it "isn't clear" if the FTC might want concessions beyond the Imperial deal.
    • Shares of both companies rallied in regular trading ahead of the report, amidst a meeting with the FTC: Reynolds rose 4.4%, and Lorillard rose 2.8%.
    | Thu, Apr. 2, 5:50 PM | Comment!
Company Description
Lorillard Inc is engaged in the manufacture of cigarettes and tobacco in the United States. The Company's principal products are marketed under the brand names of Newport, Kent, True, Maverick and Old Gold with sales in the United States of America.
Industry: Cigarettes
Country: United States