After FTC approval of merger, Imperial Tobacco shares reached all time high. The shares surged up to 48p at $33.32.
US agency gave green signal to Reynolds American acquisition agreement. The tobacco firm has decided to purchase Lorillards at $ 25 billion.
The union is expected to take place in the end of July 2015. It will allow Reynolds to sell three famous cigarette brands to Imperial Tobacco Group. The UK Cigarette manufacturer will pay around $7 billion to get hold of Winston, Salem, Kool and Maverick
Federal trade commission took more than ten months to approve the deal. The agency reviewed such kind of merger that happened in past 20 years. High officials carefully examined the consequences of the deal. They analyzed whether Imperial would be a beneficial challenger of America or not.
Additionally, the agency wanted to make certain that the merger will not affect tobacco prices. Hence, they put forward Imperial deal as a condition of approval.
The amalgamation will completely shakes the tobacco industry. After the union, Reynolds will own more than 80 percent shares of the market. On the flip side, Imperial Tobacco will become third top cigarette seller of the United States.