Reynolds American Subsidiary to Receive Payment Following Gallaher Joint-Venture Termination..

March 2, 2008 - Reynolds American Inc. (NYSE: RAI) announced today (February 21, 2008) that R.J. Reynolds Tobacco C.V. (RJR), an indirect wholly owned subsidiary of RAI, will receive a payment of euro 265.0 million (approximately $387.6 million) from Gallaher Limited (Gallaher), a JT International (JTI) Group company, resulting from the termination of the joint-venture agreement between RJR and a Gallaher affiliate. In 2002 US tobacco firm RJR formed Reynolds-Gallaher International to give the manufacturer access to cigarette sales in most countries in the European Union. It was scheduled to run through 2012 but in May 2007, as a result of the acquisition of Gallaher Group by Japan Tobacco, it was announced that this joint-venture would cease in November 2007. The joint venture marketed American- blend cigarettes primarily in Italy, France and Spain. (Gallaher brands include Benson & Hedges, Silk Cut, Mayfair, Kensitas Club, Amber Leaf and Hamlet Cigars. Japan Tobacco became the sole owner of the Gallaher Group on 18 April 2007, in the largest ever foreign acquisition in Japanese history. ( Reynolds to receive nearly $388 million to settle demise of joint international venture by Richard Craver, Winston-Salem Journal, 2/21/2008) Gallaher Sweden is part of JT International, a subsidiary of Japan Tobacco, Inc. (JT), the world's third largest international manufacturer of tobacco products. The JT Group's total tobacco net sales amount to USD 37.4 billion (US $1 = ¥118.05) in the fiscal year ended March 31, 2007. With headquarters in Geneva, Switzerland, JTI is present in over 60 markets with 23,000 employees, and sales activities in more than 120 countries. In Sweden JTI is the market leader within cigarettes with brands including Camel, Blend, Right, Level, LD, Benson & Hedges and John silver. Gallaher Snus brands include Gustavus, LD and Level. British American Tobacco (BAT) was manufacturing Camel Snus in Sweden for RJR. Be the 1st to know: Now the same process is being used to manufacture Camel Snus in Winston Salem, North Carolina. (TobaccoWatch.org)