STG Buys Lane Ltd

Source from:  Tobacco Reporter 01/17/2011

Reynolds American Inc. has reached an agreement to sell Lane Ltd. to Scandinavian Tobacco Group A/S (STG) of Denmark for $205 million. The transaction is expected to close in the first half of 2011, pending anti-trust review and approval. Based in Tucker, Georgia, USA, Lane manufactures a variety of tobacco products including Kite and Bugler roll-your-own tobacco, and Captain Black pipe tobacco. STG is the world's leader in pipe tobacco sales, holds a shared No. 1 position in sales of cigars internationally, and has a strong position within the roll-your-own segment in Scandinavia. R.J. Reynolds Tobacco Co., another RAI subsidiary, handles Lane's sales, marketing and distribution through a services agreement. "Reynolds American's operating companies are strategically focused on key brands in the cigarette, moist-snuff and modern smoke-free categories of the tobacco business, so this is an opportunity to maximize the potential of the Lane business and brands under an owner who is focused on the 'other tobacco products' (OTP) category," said Susan M. Ivey, president and chief executive officer of Reynolds American. Lane has about 110 employees at two facilities in Tucker-a manufacturing and office facility, and a leased warehousing facility. Under terms of the agreement, STG will take over Lane's facilities and expects to continue to operate them. "The sale allows RAI and its operating companies to devote their energy and resources to the primary growth categories within their businesses," Ivey said. "I wish to thank the employees of Lane for their dedication and years of hard work." Enditem