FTC Approves Proposed Acquisition of Conwood by Reynolds American
May 23 2006 - 5:21PM
PR Newswire (US)
WINSTON-SALEM, N.C., May 23 /PRNewswire-FirstCall/ -- Reynolds
American Inc. (NYSE:RAI) announced today that it has received
notification that the Federal Trade Commission has granted early
termination of the Hart-Scott- Rodino Antitrust Improvements Act of
1976 waiting period related to RAI's proposed acquisition of a
holding company that owns Conwood, the nation's second largest
manufacturer of smokeless tobacco products. Reynolds American said
it still expects to close the acquisition in the second quarter.
RISK FACTORS Statements included in this news release that 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 RAI's
future performance and financial results inherently are subject to
a variety of risks and uncertainties that could cause actual
results to differ materially from those described in the
forward-looking statements. These risks and uncertainties include:
- the substantial and increasing regulation and taxation of the
tobacco industry; - various legal actions, proceedings and claims
relating to the sale, distribution, manufacture, development,
advertising, marketing and claimed health effects of tobacco
products that are pending or may be instituted against RAI or its
subsidiaries; - the substantial payment obligations and limitations
on the advertising and marketing of cigarettes under the MSA and
other state settlement agreements; - the continuing decline in
volume in the domestic cigarette industry; - competition from other
manufacturers, including any new entrants in the marketplace; -
increased promotional activities by competitors and the growth of
deep- discount cigarette brands; - the success or failure of new
product innovations and acquisitions; - the responsiveness of both
the trade and consumers to new products, marketing strategies and
promotional programs; - the ability to realize the benefits and
synergies arising from the combination of RJR Tobacco and the U.S.
cigarette and tobacco business of B&W; - the ability to achieve
efficiencies in manufacturing and distribution operations without
negatively affecting sales; - the cost of tobacco leaf and other
raw materials and other commodities used in products, including
future market pricing of tobacco leaf which could adversely impact
inventory valuations; - the effect of market conditions on foreign
currency exchange rate risk, interest rate risk and the return on
corporate cash; - the effect of market conditions on the
performance of pension assets or any adverse effects of any new
legislation or regulations changing pension expense accounting or
required pension funding levels; - the rating of RAI's and RJR's
securities; - any restrictive covenants imposed under RAI's and
RJR's debt agreements; - the possibility of fire, violent weather
and other disasters that may adversely affect the manufacturing
facilities; - any adverse effects from the transition of the
packaging operations formerly conducted by RJR Packaging, LLC, a
wholly owned subsidiary of RJR Tobacco, to the buyers of RJR
Packaging, LLC's businesses; - any adverse effects arising out of
the implementation of an SAP enterprise business system in the
third quarter of 2006; - the potential existence of significant
deficiencies or material weaknesses in internal controls over
financial reporting that may be identified during the performance
of testing required under Section 404 of the Sarbanes-Oxley Act of
2002; and - the failure to consummate the announced acquisition of
Conwood, or to realize the anticipated benefits and synergies
arising from such acquisition, if consummated. Due to these risks
and uncertainties, you are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date
of this news release. Except as provided by federal securities
laws, RAI is not required to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise. ABOUT US Reynolds American Inc.
(NYSE:RAI) is the parent company of R.J. Reynolds Tobacco Company,
Santa Fe Natural Tobacco Company, Inc., Lane Limited and R.J.
Reynolds Global Products, Inc. R.J. Reynolds Tobacco Company, the
second- largest U.S. tobacco company, manufactures about one of
every three cigarettes sold in the country. The company's brands
include five of the 10 best-selling U.S. brands: Camel, Kool,
Winston, Salem and Doral. Santa Fe Natural Tobacco Company, Inc.
manufactures Natural American Spirit cigarettes and other tobacco
products for U.S. and international markets. Lane Limited
manufactures several roll-your-own, pipe tobacco and little cigar
brands, and distributes Dunhill tobacco products. R.J. Reynolds
Global Products, Inc. manufactures, sells and distributes
American-blend cigarettes and other tobacco products to a variety
of customers worldwide. Copies of RAI's news releases, annual
reports, SEC filings and other financial materials are available at
http://www.reynoldsamerican.com/. DATASOURCE: Reynolds American
Inc. CONTACT: Investor Relations, Ken Whitehurst, +1-336-741-0951,
or Media, Maura Payne, +1-336-741-6996, both of Reynolds American
Inc. Web site: http://www.reynoldsamerican.com/
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