reynolds american inc (RAI) Key Developments
Reynolds American and Lorillard Receive Requests for Additional Information from Federal Trade Commission
Aug 29 14
Reynolds American Inc. and Lorillard, Inc. announced that each company has received a request for additional information (second request) from the Federal Trade Commission (FTC) in connection with Reynolds American's pending acquisition of Lorillard and divestiture of select brands to Imperial Tobacco Group, PLC. The second request was issued under notification requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the HSR Act) and is a normal part of the regulatory review process. The effect of the second request is to extend the waiting period imposed by the HSR Act until 30 days after Reynolds American and Lorillard have substantially complied with the request, unless that period is extended voluntarily by both parties or terminated sooner by the FTC. Reynolds American and Lorillard will continue to cooperate fully with the FTC as it conducts its review of the proposed acquisition and divestiture. In addition to the expiration of the waiting period under the HSR Act, both the Reynolds American acquisition of Lorillard as well as the Imperial transaction remain subject to shareholder and other approvals, as well as other customary closing conditions. The companies continue to expect the transactions to close in the first half of 2015.
Reynolds American Inc. Presents at Barclays Capital Back-to-School Consumer Conference 2014, Sep-04-2014 09:45 AM
Aug 22 14
Reynolds American Inc. Presents at Barclays Capital Back-to-School Consumer Conference 2014, Sep-04-2014 09:45 AM. Venue: InterContinental Hotel, Boston, Massachusetts, United States. Speakers: Susan M. Cameron, Chief Executive Officer, President, Director and President of Rai Services Company.
Reynolds American Inc. Enters into the First Amendment to Credit Agreement
Aug 11 14
On August 7, 2014, Reynolds American Inc.(RAI) enters into the First Amendment to Credit Agreement with the other parties to the Credit Agreement, providing for the amendment of certain provisions of the Credit Agreement. Subject to the satisfaction of certain conditions precedent as set forth therein, including the payment of an amendment fee described therein, the First Amendment, among other things: amends the consolidated leverage ratio covenant in Section 6.04(a) of the Credit Agreement to increase such level from 3.00 to 1.00 to 4.50 to 1.00, with the initial increase taking effect on the last day of RAI’s fiscal quarter in which the closing occurs of the previously reported proposed merger of Lantern Acquisition Co. with and into Lorillard Inc. with Lorillard surviving as a wholly owned subsidiary of RAI, pursuant to that certain Agreement and Plan of Merger dated as of July 15, 2014; amends and restates the definition of Consolidated EBITDA, which term is used in the calculation of the consolidated interest coverage ratio and consolidated leverage ratio financial covenants contained in the Credit Agreement; adds certain new defined terms to the Credit Agreement; and amends the restrictive covenants relating to fundamental changes, restricted payments, transactions with affiliates, restrictive agreements and subsidiary indebtedness in Sections 6.03, 6.05, 6.06, 6.07 and 6.08, respectively, of the Credit Agreement by providing for one or more additional exceptions to such covenants. The First Amendment accommodates or permits the proposed Merger and the transactions related thereto, including the previously reported proposed: 364-day senior unsecured term loan bridge facility in an aggregate principal amount of up to $9 billion that may be provided, subject to certain conditions, to RAI by certain financial institutions for the purpose of financing part of the cash portion of the Merger consideration, and fees and expenses in connection with the transactions contemplated by the Merger Agreement; disposition of certain assets of RAI’s and Lorillard’s subsidiaries, related to certain cigarette and e-cigarette brands, to a subsidiary of Imperial Tobacco Group PLC; and subscription by British American Tobacco p.l.c. for such number of shares of RAI common stock that will enable it to maintain its 42% ownership interest in RAI immediately following completion of the Merger.
Reynolds American Inc. Reports Unaudited Consolidated Earnings Results for the Second Quarter and Six Months Ended June 30, 2014; Revised Earnings Guidance for the Full Year of 2014
Jul 29 14
Reynolds American Inc. reported unaudited consolidated earnings results for the second quarter and six months ended June 30, 2014. For the quarter, the company reported net sales of $2,162 million compared to $2,179 million for the same period a year ago. Operating income was $836 million compared to $798 million for the same period a year ago. Income from continuing operations before income taxes was $775 million compared to $732 million for the same period a year ago. Income from continuing operations was $492 million or $0.92 per diluted share compared to $461 million or $0.84 per diluted share for the same period a year ago. Net income was $492 million or $0.92 per diluted share compared to $461 million or $0.84 per diluted share for the same period a year ago. Adjusted operating income was $808 million compared to $800 million for the same period a year ago. Adjusted net income was $474 million or $0.89 per diluted share compared to $462 million or $0.84 per diluted share for the same period a year ago.
For six months, the company reported net sales of $4,097 million compared to $4,062 million for the same period a year ago. Operating income was $1,426 million compared to $1,685 million for the same period a year ago. Income from continuing operations before income taxes was $1,306 million compared to $1,561 million for the same period a year ago. Income from continuing operations was $830 million or $1.55 per diluted share compared to $969 million or $1.76 per diluted share for the same period a year ago. Net income was $855 million or $1.59 per diluted share compared to $969 million or $1.76 per diluted share for the same period a year ago. Adjusted operating income was $1,473 million compared to $1,490 million for the same period a year ago. Adjusted net income was $860 million or $1.60 per diluted share compared to $860 million or $1.56 per diluted share for the same period a year ago.
The company said that based on this successful first-half performance, the company has tightened its guidance for the year. The company now expects 2014 adjusted EPS in the range of $3.35 to $3.45, from a previous $3.30 to $3.45.
Reynolds American Inc. Declares Quarterly Cash Dividend, Payable on October 1, 2014
Jul 17 14
Reynolds American Inc. declared quarterly cash dividend on the company's common stock of $0.67 per share. This represents $2.68 per share annualized. The dividend will be payable on October 1, 2014 to shareholders of record on September 10, 2014.