The Altria Group, manufacturer of Marlboro cigarettes, is mulling a rival bid for Altadis, the Franco-Spanish manufacturer of Gauloises. Altadis just rejected a €45 per share offer from British company Imperial Tobacco. The Imperial offer, which totaled €11.5 billion ($15.3 billion), was made last Thursday. Altadis claims that €53 per share would be a fairer price, and Imperial has indicated that it will continue to make "friendly" overtures. Imperial shares surged Friday on corollary speculation that Imperial would be taken over by Altria before it becomes too sizeable a competitor; such an acquisition would also give Altria market dominance in the U.K. There are also rumors that British American Tobacco might make a play for Altadis. Altadis, which has said it considers itself an acquirer and not a target, might make a retaliatory bid for Imperial. Analysts believe the Imperial bid for Altadis will likely set off "large-scale consolidation in the global tobacco industry."
Sources: MoneyCentral, New York Times
Commentary: Warning: Cigarettes May Be Good For Your Financial Health • Jump Aboard The Altria Train • Howling At The Moon: Dogs and Flying Five 2007 Stock Picks
Stocks/ETFs to watch: Altria Group, Inc. (NYSE:MO), Imperial Tobacco Group PLC [ADR] (ITY), ]Altadis, S.A. [MCE:ALT]. Competitors: British American Tobacco plc (NYSEMKT:BTI), Reynolds American Inc. (NYSE:RAI). ETFs: First Trust Morningstar Div Leaders Idx (NYSEARCA:FDL), WisdomTree High-Yielding Equity (NYSEARCA:DHS), WisdomTree LargeCap Dividend (NYSEARCA:DLN)
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