Seeking Alpha

Reynolds American, Inc. (RAI)

  • Sep. 4, 2014, 10:37 AM
    • Reynolds American (RAI +0.3%) plans to take its Zonnic nicotine gum national after testing the product in Iowa and Nebraska.
    • Zonnic will sell at a lower price than many nicotine replacement products.
    • Sales of nicotine-replacement products in the U.S. came in at just a shade under $1B last year.
    | Comment!
  • Sep. 4, 2014, 2:49 AM
    • After a German court last month ordered a Lorillard (NYSE:LO) subsidiary to stop selling its blu e-cigarettes as a result of another claim from Zippo, Lorillard has decided to take the lighter manufacturer to a U.K. High Court.
    • Zippo declares that it has been using the Blu brand name for its butane torch lighters since 2007, although Lorillard says the threats are unfounded and is now seeking damages for Zippo's conduct.
    • Blu e-cigarettes are currently being sold to Imperial Tobacco (OTCQX:ITYBY) as part of Lorillard's $27.4B merger with Reynolds American (NYSE:RAI).
    | Comment!
  • Sep. 2, 2014, 2:18 AM
    • Imperial Tobacco (OTCQX:ITYBY) has closed approximately $13B of loans to finance its acquisition of several brands and assets of Reynolds American (NYSE:RAI).
    • The financing covers the $7.1B acquisition of cigarette brands, Winston, Maverick, Kool, Salem and blu, which Reynolds wished to unload to clear the way for its merger with Lorillard (NYSE:LO).
    • As part of the purchase, Imperial will also take over Lorillard's national sales force, offices and production facilities.
    | Comment!
  • Aug. 29, 2014, 8:10 AM
    • Reynolds American (NYSE:RAI) and Lorillard (NYSE:LO) disclose that they received an additional request from the FTC in connection with the pending merger between the two tobacco giants.
    • The companies still expect the merger and the related divestiture of brands to Imperial Tobacco (OTCQX:ITYBY) to close in the first half of 2015.
    | Comment!
  • Aug. 26, 2014, 12:23 PM
  • Aug. 25, 2014, 12:15 PM
  • Aug. 8, 2014, 1:35 PM
  • Aug. 6, 2014, 10:00 AM
    • Tobacco stocks are higher today in what analysts are calling a defensive move by investors.
    • There's also been some stronger pricing trends on the lower-end of the cigarette market that has helped to boost the outlook on the group.
    • Gainers: Philip Morris (PM +2.2%), Reynolds American (RAI +1.6%), Vector Group (VGR +1.4%), and Altrai (MO +1.9%).
  • Jul. 29, 2014, 8:52 AM
    • Reynolds American (NYSE:RAI) reports cigarette shipments fell 8.3% Y/Y in Q2 - mark which was worse than the industry average of a 5.5% volume drop.
    • Though the Camel and Pall Mall brands made market share gains, overall Reynolds lost 10 bps of share to 26.5%.
    • The Vuse roll-out began during the quarter and by the end of the period over 21K retail outlets sold the e-cig product.
    • The company tightened its guidance to a range of $3.35-$3.45 vs. $3.30-$3.45 prior.
    • RAI -0.7% premarket
  • Jul. 29, 2014, 7:51 AM
    • Reynolds American (NYSE:RAI): Q2 EPS of $0.89 beats by $0.02.
    • Revenue of $2.16B (-0.9% Y/Y) misses by $30M.
    • Press Release
    | Comment!
  • Jul. 21, 2014, 4:12 AM
    • The R.J. Reynolds (NYSE:RAI) lawsuit awarding $23.6B in punitive damages to the widow of a longtime smoker who died of lung cancer is likely to be rejected on appeal or the award reduced substantially, Reuters reports.
    • The payment likely falls outside the boundaries for punitive damages that the U.S. Supreme Court has laid down in a series of cases.
    • Constitutional guarantees of due process do not usually allow punitive damages to exorbitantly exceed compensatory damages of the same case. The general guideline is a ratio of 10:1.
  • Jul. 20, 2014, 9:52 AM
    • Reynolds American's (NYSE:RAI) subsidiary, R.J. Reynolds, has been slammed with $23.6B in punitive damages and $16.8M in compensatory damages from a lawsuit filed by the widow of a longtime smoker who died of lung cancer.
    • The lawsuit was filed six years ago after a Florida Supreme Court ruling stated that smokers and their families need only prove that addiction and smoking caused their illnesses or deaths to be eligible for damage payments.
    • The record ruling was re-approved last year, making it easier for sick smokers and their survivors to sue tobacco companies, and triggered thousands of new court cases.
    • R.J. Reynolds VP and assistant general counsel J. Jeffery Raborn intends to fight the verdict, calling it grossly excessive and unconstitutional. "This verdict goes far beyond the realm of reasonableness and fairness, and is completely inconsistent with the evidence presented," says Raborn. "We plan to file post-trial motions with the trial court promptly, and are confident that the court will follow the law and not allow this runaway verdict to stand."
  • Jul. 15, 2014, 10:53 AM
    • Tobacco stocks slump as a group after Lorillard doesn't catch the premium in the Reynolds American buyout that some anticipated.
    • Even Imperial Tobacco which ended up with the hot Blu e-cigarette brand as part of the deal is having trouble shaking off the pessimism.
    • Decliners: Lorillard (NYSE:LO) -7.9%, Philip Morris (NYSE:PM) -1.3%, Altria (NYSE:MO) -2.1%, Vector Group (NYSE:VGR) -0.8%, Reynolds American (NYSE:RAI) -4.0%, Imperial Tobacco (OTCMKTS:ITYBY) -2.8%, British American Tobacco (NYSEMKT:BTI) -1.4%.
  • Jul. 15, 2014, 7:22 AM
    • Reynolds American (NYSE:RAI) says it will unload the Kool, Salem, Winston, Maverick, and blu eCigs brands along with some other assets to Imperial Tobacco (OTCMKTS:ITYBY) for $7.1B. The move is aimed at appeasing regulators.
    • The company says the acquisition of Lorillard (NYSE:LO) will be accretive within the first full year and will show a double-digit accretion rate in the second year and beyond.
    • A cooperation deal was struck between Reynolds and British American Tobacco (NYSEMKT:BTI) which includes sharing technology and development costs on next-gen tobacco products.
    • Premarket: Lorillard -3.7%, Reynolds American -0.2%, British American Tobacco (BTI) -0.5%.
  • Jul. 15, 2014, 7:14 AM
    • Reynolds American (NYSE:RAI) announces it will buy Lorillard (NYSE:LO) in a deal valued at $27.4B.
    • Lorillard shareholders will receive $50.50 in cash and 0.2909 a share of Reynold at closing, which reps a deal price of $68.88 at Reynold's current trading level.
    • British American Tobacco (NYSEMKT:BTI) will hold on to its 42% stake in Reynolds as part of the deal.
  • Jul. 14, 2014, 7:59 AM
    • The reduced pace of smoking lawsuits is helping to stoke up M&A activity in the tobacco sector, according to analysts.
    • Reynolds American (NYSE:RAI) disclosed in a recent SEC filing that it faced 5K Engle-related suits in Q1 of 2014, well-off the high litigation pace of a few years ago.
    • The clearer visibility on liability in the sector should help push forward deals which a few years ago would have stalled.
    • Lorillard (NYSE:LO) is +0.7% to $66.48 in premarket trading.
    | 1 Comment
Visit Seeking Alpha's
RAI vs. ETF Alternatives
Company Description
Reynolds American Inc, through its subsidiaries, manufactures cigarettes and other tobacco products in the United States. The products brand include CAMEL, PALL MALL, WINSTON, among others.
Industry: Cigarettes
Country: United States