Cases & Deals

Reynolds American acquired by British American Tobacco Plc in deal valued at $49 billion

Client(s) Reynolds American Inc.

Jones Day advised Reynolds American Inc. ("RAI") regarding the acquisition by British American Tobacco, p.l.c. ("BAT") of 57.8 percent of the outstanding shares of RAI not owned by BAT and its affiliates in a transaction valued at $49 billion. The sale was effected through a merger of a wholly owned subsidiary of BAT with and into RAI.

For each share of RAI held by them, RAI shareholders received a specified amount of BAT American depository shares representing 0.526 BAT ordinary shares and $29.44 in cash. The transaction was unanimously approved by the board of directors of both companies, as well as by the independent directors of RAI who formed a transaction committee of the RAI board of directors to evaluate the transaction given BAT's shareholder ownership.

BAT is now the world's largest listed tobacco company by net revenue and operating profit. Legacy-RAI shareholders (other than BAT and its subsidiaries) will hold equity representing approximately 19 percent of the outstanding BAT ordinary shares.