On July 17, 2003, Standard&Poor's Ratings Services placed its 'A-' long-term ratings on U.K.-based international tobacco company British American Tobacco PLC (BAT) and related entities on CreditWatch with negative implications following the announcement that it is to acquire Ente Tabacchi Italiana SpA, Italy's state tobacco company, for €2.32 billion ($2.6 billion) in cash. At the same time, Standard&Poor's affirmed its 'A-2' short-term credit ratings on BAT. The cash amount of the acquisition, which represents nearly 12x the EBITDA of the acquired business, and BAT's emphasis on shareholder value, are likely to prevent the group from restoring a financial profile in line with the current rating level in the near term, and maintaining it thereafter. This includes
