... is unlikely following that between Lorillard, Inc., Reynolds American Inc. (RAI), British American Tobacco (BAT) and Imperial Brands (Imperial) in the US in 2015. A possible transaction between the combination of BAT and Imperial or Imperial and Japan Tobacco Inc. (JT) is not impossible, but is unlikely given the currently high share price of Imperial, the potential anti-trust issues and the limited capacity of BAT, having made large acquisitions in 2015. Regulatory Changes Manageable: Fitch Ratings views regulatory changes as broadly manageable. The large tobacco companies have had a good record of navigating through regulatory changes. The implementation of a revised European Union Tobacco Product Directive (EUTPD) was implemented in May 2016 and plain packaging implementation is scheduled by January 2017 in France and by May 2017 in the UK. Next Generation Products Potential: The large tobacco players are stepping up their investments in...
