The two tobacco companies, which acknowledged merger talks last week, announced the $68.88-per-share combination today to create an $11B-per-year seller of brands like Newport, Camel and Natural American Spirit.
As part of the deal, UK-based Imperial is stepping in to buy for $7.1B the Kool, Salem, Winston, Maverick and blue Cigs brands, tripling that company's US market share. It will also buy a North Carolina Lorillard factory.
In a fourth piece of the transaction, Reynolds' top shareholder British American Tobacco will spend $4.7B to maintain a 42% ownership stake.
Joele Frank partners Meagan Repko and Andrea Rose are handling communications regarding the deal for Lorillard.
David Howard, senior dir. of comms. for Reynolds, said Brunswick Group worked with the company on the project.
Reynolds president and CEO Susan Cameron will retain that role post-merger while Lorillard chairman/president/CEO is slated to join the Reynolds board.
The companies will be the No. 2 US tobacco company behind Altria and are pitching a cost-savings of $800M. They expect the deals to close in the first half of 2015.