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Buyout Buzz: Reynolds American May Bid for Lorillard

The bid will be for "no more than $22 million at first"


Reynolds American (RAI) may make a bid for tobacco giant Lorillard (LO), according to a report by The Financial Times blog.

Reynolds AmericanThe blog quoted knowledgeable sources and stated that Reynolds may offer “no more than $22 billion at first” in its bid for Lorillard. Reynolds Tobacco is a subsidiary of Reynolds American and it is the second-largest tobacco company in the U.S.

This would be a massive coup for the company as Lorillard is the third-largest manufacturer of cigarettes in the U.S. Lorillard’s flagship product is Newport which is the second-largest selling cigarette brand in the U.S.

LO stock is up about 4.75% in early afternoon trading Monday. RAI stock is up 2.5%.

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